6-K

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FORM 6-K

________________________________________

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

Commission File Number: 001-38757

For the month of October 2023

________________________________________

TAKEDA PHARMACEUTICAL COMPANY LIMITED

(Translation of registrant’s name into English)

________________________________________

1-1, Nihonbashi-Honcho 2-Chome

Chuo-ku, Tokyo 103-8668

Japan

(Address of principal executive offices)

________________________________________

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  ☒            Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

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Information furnished on this form:

Pursuant to the Financial Instruments and Exchange Act of Japan, Takeda Pharmaceutical Company Limited filed its Quarterly Securities Report for The Six-month Period with the Director of the Kanto Local Finance Bureau in Japan on October 30, 2023. An English translation of such report is included as an exhibit hereto.

EXHIBIT

Exhibit<br>Number
1.	(English Translation) Quarterly Securities Report For The Six-month Period and Three-month Quarter Ended September 30, 2023
99.1	Financial Appendix

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TAKEDA PHARMACEUTICAL COMPANY LIMITED
Date: October 30, 2023	By:	/s/ Norimasa Takeda
		Norimasa Takeda<br>Chief Accounting Officer and Corporate Controller

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Translation for reference purpose only

Quarterly Securities Report

(The second quarter of 147th Business Term)

for The Six-month Period and Three-month

Quarter Ended September 30, 2023

TAKEDA PHARMACEUTICAL COMPANY LIMITED

AND ITS SUBSIDIARIES

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Index

	Page
[Cover]	1
A. Company Information
I. Overview of Takeda	2
1. Key Consolidated Financial Data	2
2. Business Overview	2
II. Operating and Financial Review	3
1. Risk Factors	3
2. Analysis on Business Performance, Financial Position and Cash Flows	3
3. Material Contracts	16
III. Information on the Company	17
1. Information on the Company’s Shares	17
2. Members of the Board of Directors	19
IV. Financial Information	20
1. Condensed Interim Consolidated Financial Statements	21
2. Others	40
B. Information on Guarantors of the Company	41
[Financial Appendix]

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[Cover]
[Document Filed]	Quarterly Securities Report
[Applicable Law]	Article 24-4-7, paragraph 1 of the Financial Instruments and Exchange Act of Japan
[Filed with]	Director, Kanto Local Finance Bureau
[Filing Date]	October 30, 2023
[Fiscal period]	The second quarter of 147th Business Term<br><br>(from July 1, 2023 to September 30, 2023)
[Company Name]	Takeda Pharmaceutical Company Limited
[Title and Name of Representative]	Christophe Weber, Representative Director, President & Chief Executive Officer
[Address of Head Office]	1-1, Doshomachi 4-chome, Chuo-ku, Osaka
	(The above address is the registered head office location and the ordinary business<br><br>operations are conducted at the “Nearest Place of Contact”)
[Telephone Number]	Not applicable
[Name of Contact Person]	Not applicable
[Nearest Place of Contact]	1-1, Nihonbashi-Honcho 2-chome, Chuo-ku, Tokyo
	(Global Headquarters)
[Telephone Number]	+81-3-3278-2111 (Main telephone number)
[Name of Contact Person]	Norimasa Takeda, Chief Accounting Officer & Corporate Controller, Global Finance
[Place for public inspection]	Takeda Pharmaceutical Company Limited (Global Headquarters)
	(1-1, Nihonbashi Honcho 2-chome, Chuo-ku, Tokyo)
	Tokyo Stock Exchange, Inc.
	(2-1, Nihonbashi Kabutocho, Chuo-ku, Tokyo)
	Nagoya Stock Exchange, Inc.
	(8-20, Sakae 3-chome, Naka-ku, Nagoya)
	Fukuoka Stock Exchange
	(14-2, Tenjin 2-chome, Chuo-ku, Fukuoka)
	Sapporo Stock Exchange
	(14-1, Minamiichijonishi 5-chome, Chuo-ku, Sapporo)

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A. Company Information

I. Overview of Takeda

1. Key Consolidated Financial Data

	(millions), unless otherwise indicated
	Six-month period ended September 30,	For the year ended March 31,
Term	2022	2023
Revenue	1,974,771	4,027,478
<Three-month period ended September 30>	1,002,307
Profit before tax	220,022	375,090
Net profit for the period	166,753	317,038
Net profit (loss) attributable to owners of the Company	166,756	317,017
<Three-month period ended September 30>	61,742
Total comprehensive income for the period	1,163,590	911,574
Total equity	6,713,489	6,354,672
Total assets	14,588,847	13,957,750
Basic earnings (loss) per share (JPY)	107.62	204.29
<Three-month period ended September 30>	39.77
Diluted earnings per share (JPY)	106.88	201.94
Ratio of equity attributable to owners of the Company to total assets (%)	46.0	45.5
Net cash from operating activities	305,234	977,156
Net cash used in investing activities	(121,920)	(607,102)
Net cash used in financing activities	(267,593)	(709,148)
Cash and cash equivalents at the end of the period	798,137	533,530

All values are in Japanese Yen.

(Note 1)    All amounts shown are rounded to the nearest million JPY.

(Note 2)    The key consolidated financial data for the six-month period ended September 30, 2022 and 2023 are based on the condensed interim consolidated financial statements prepared in accordance with IAS 34.

2. Business Overview

There has been no significant change in our business for the six-month period ended September 30, 2023.

As of September 30, 2023, Takeda consisted of 188 entities comprised of 171 consolidated subsidiaries (including partnerships), 16 associates accounted for using the equity method, and Takeda Pharmaceutical Company Limited. There has been no significant change in our group companies for the six-month period ended September 30, 2023.

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II. Operating and Financial Review

1. Risk Factors

There were no new risk factors identified for the six-month period ended September 30, 2023 as well as no significant changes in the risk factors compared to what we reported in our Annual Securities Report for the year ended March 31, 2023 which was filed in Japan.

2. Analysis on Business Performance, Financial Position and Cash Flows

(1) Consolidated Financial Results (April 1 to September 30, 2023)

			Billion or percentage
		FY2022 H1				Change versus the same period of the previous fiscal year
	AER						CER
	Amount of Change			% Change			% Change
Revenue			1,974.8		2,101.7		126.9	6.4	%	1.4	%
Cost of sales			(598.3)		(664.7)		(66.4)	11.1	%	6.0	%
Selling, general and administrative expenses			(480.2)		(501.1)		(20.9)	4.3	%	(0.8)	%
Research and development expenses			(297.8)		(346.7)		(48.9)	16.4	%	9.6	%
Amortization and impairment losses on intangible assets associated with products			(273.6)		(369.7)		(96.0)	35.1	%	25.8	%
Other operating income			13.5		9.9		(3.6)	(26.7)	%	(27.6)	%
Other operating expenses			(83.4)		(110.2)		(26.9)	32.2	%	27.1	%
Operating profit			255.0		119.2		(135.7)	(53.2)	%	(50.6)	%
Finance income and (expenses), net			(33.6)		(81.8)		(48.2)	143.7	%	147.9	%
Share of profit (loss) of investments accounted for using the equity method			(1.4)		1.6		3.0	―		―
Profit before tax			220.0		39.1		(181.0)	(82.3)	%	(79.8)	%
Income tax (expenses) benefit			(53.3)		2.4		55.7	―		(86.0)	%
Net profit for the period			166.8		41.4		(125.3)	(75.2)	%	(77.8)	%

All values are in Japanese Yen.

In this section, when comparing results to the same period of the previous fiscal year, the amount of change and percentage change based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentage change based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to Core Results (April 1 to September 30, 2023), Definition of Core financial measures and Constant Exchange Rate change, for the definition of “Constant Exchange Rate change”.

Revenue

Revenue for the six-month period ended September 30, 2023 was JPY 2,101.7 billion (JPY +126.9 billion and +6.4% AER, +1.4% CER). The increase is primarily attributable to favorable foreign exchange rates and growth from business momentum of our five key business areas (i.e. Gastroenterology (“GI”), Rare Diseases, Plasma-Derived Therapies (“PDT”) Immunology, Oncology, and Neuroscience), with the exception of Oncology which was impacted by generic erosion and intensified competition on certain products in the current period. In addition, revenue outside of our five key business areas decreased mainly due to lower revenue contribution from COVID-19 vaccines in Japan.

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Revenue by Geographic Region

The following shows revenue by geographic region:

	Billion or percentage
	FY2022 H1		Change versus the same period of the previous fiscal year
		AER				CER
Revenue:		Amount of Change		% Change		% Change
Japan	261.4		(32.8)		(12.6)	%	(12.8)	%
United States	1,032.5		72.2		7.0	%	0.1	%
Europe and Canada	409.0		51.0		12.5	%	3.4	%
Asia (excluding Japan)	105.7		17.6		16.6	%	14.4	%
Latin America	83.3		8.8		10.6	%	15.8	%
Russia/CIS	37.8		(6.7)		(17.8)	%	(4.5)	%
Other*1	45.1		16.9		37.4	%	44.0	%
Total	1,974.8		126.9		6.4	%	1.4	%

All values are in Japanese Yen.

*1 Other includes the Middle East, Oceania and Africa.

Revenue by Business Area

The following shows revenue by business area:

	Billion or percentage
	FY2022 H1		Change versus the same period of the previous fiscal year
		AER				CER
Revenue:		Amount of Change		% Change		% Change
GI	546.4		50.5		9.2	%	3.0	%
Rare Diseases	362.2		18.7		5.2	%	1.9	%
Rare Hematology	155.7		(3.0)		(1.9)	%	(5.7)	%
Rare Genetics and Other	206.5		21.7		10.5	%	7.6	%
PDT Immunology	314.0		74.4		23.7	%	17.2	%
Oncology	225.3		(0.1)		(0.1)	%	(3.0)	%
Neuroscience	302.3		28.4		9.4	%	3.2	%
Other	224.6		(44.9)		(20.0)	%	(23.1)	%
Total	1,974.8		126.9		6.4	%	1.4	%

All values are in Japanese Yen.

Year-on-year change in revenue for this six-month period in each of our business areas was primarily attributable to the following products:

GI

In GI, revenue was JPY 596.9 billion (JPY +50.5 billion and +9.2% AER, +3.0% CER).

Sales of ENTYVIO (for ulcerative colitis (“UC”) and Crohn’s disease (“CD”)) were JPY 391.7 billion (JPY +45.1 billion and +13.0% AER, +5.8% CER). Sales in the U.S. were JPY 271.1 billion (JPY +27.3 billion and +11.2% AER). The increase was due to favorable foreign exchange rates and demand in the first line biologic inflammatory bowel disease (“IBD”) population primarily in UC. Sales in Europe and Canada were JPY 92.0 billion (JPY +13.2 billion and +16.7% AER). The increase was primarily due to favorable foreign exchange rates and new patient gains by an increased use of the subcutaneous formulation.

Sales of GATTEX/REVESTIVE (for short bowel syndrome) were JPY 58.9 billion (JPY +10.5 billion and +21.6% AER, +15.5% CER). The increase was primarily due to increased demand across all regions, expansion activities (infant indication label expansion and geographic expansion), and favorable exchange rates.

Sales of TAKECAB/VOCINTI (for acid-related diseases) were JPY 58.8 billion (JPY +4.1 billion and +7.5% AER, +6.9% CER). The increase was primarily due to increased sales in Japan and the Growth and Emerging Markets including Brazil and China.

Sales of DEXILANT (for acid reflux disease) were JPY 23.2 billion (JPY -14.8 billion and -39.0% AER, -43.1% CER). The decrease was due to the loss of exclusivity and the termination of the authorized generics program in the U.S.

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Rare Diseases

In Rare Diseases, revenue was JPY 381.0 billion (JPY +18.7 billion and +5.2% AER, +1.9% CER).

Revenue of Rare Hematology was JPY 152.7 billion (JPY -3.0 billion and -1.9% AER, -5.7% CER).

Sales of FEIBA (for hemophilia A and B) were JPY 19.8 billion (JPY -1.5 billion and -7.0% AER, -10.7% CER). The decrease was primarily due to competition in Brazil.

Aggregate sales of plasma-derived human coagulation factor products, HEMOFIL (for hemophilia A), IMMUNATE (for hemophilia A), and IMMUNINE (for hemophilia B) were JPY 9.3 billion (JPY -1.3 billion and -12.5% AER, -16.4% CER). The decrease was primarily due to decreased sales in the Growth and Emerging Markets.

Sales of ADYNOVATE/ADYNOVI (for hemophilia A) were JPY 33.5 billion (JPY -0.9 billion and -2.7% AER, -6.5% CER). The decrease was primarily due to negative impacts from competition in the U.S.

Sales of VONVENDI (for von Willebrand disease) were JPY 7.4 billion (JPY +1.5 billion and +26.0% AER, +17.3% CER). The increase was primarily due to increased demand in the U.S.

Revenue of Rare Genetics and Other was JPY 228.2 billion (JPY +21.7 billion and +10.5% AER, +7.6% CER).

Sales of TAKHZYRO (for hereditary angioedema) were JPY 87.1 billion (JPY +14.3 billion and +19.6% AER, +13.1% CER). The continued growth was attributable to sustained launch momentum, expansion into new patient populations such as pediatrics, rising diagnosis rates, the growth of the prophylactic market, and favorable exchange rates.

Sales of LIVTENCITY (for post-transplant cytomegalovirus (“CMV”) infection/disease) were JPY 8.3 billion (JPY +4.1 billion and +96.9% AER, +83.2% CER). The increase was primarily attributable to strong market penetration and successful launch performance in the U.S., complemented by continued geographical expansion in Europe.

Sales of enzyme replacement therapy ELAPRASE (for Hunter syndrome) were JPY 45.7 billion (JPY +3.3 billion and +7.7% AER, +6.3% CER). The increase was primarily due to strong demand in the Growth and Emerging Markets.

PDT Immunology

In PDT Immunology, revenue was JPY 388.4 billion (JPY +74.4 billion and +23.7% AER, +17.2% CER).

Aggregate sales of immunoglobulin products were JPY 309.2 billion (JPY +64.1 billion and +26.2% AER, +19.0% CER). Sales of each of our three global immunoglobulin brands marked double digit percentage of revenue growth, due to continued strong demand globally and growing supply, as well as favorable foreign exchange rates. Those include GAMMAGARD LIQUID/KIOVIG (for the treatment of primary immunodeficiency (“PID”) and multifocal motor neuropathy (“MMN”)), and subcutaneous immunoglobulin therapies (CUVITRU and HYQVIA) which are growing due to their benefit to patients and convenience in administration compared to intravenous therapies.

Aggregate sales of albumin products including HUMAN ALBUMIN and FLEXBUMIN (both primarily used for hypovolemia and hypoalbuminemia) were JPY 58.9 billion (JPY +7.2 billion and +13.9% AER, +10.9% CER). The increase was primarily driven by strong albumin demand in China.

Oncology

In Oncology, revenue was JPY 225.2 billion (JPY -0.1 billion and -0.1% AER, -3.0% CER).

Sales of VELCADE (for multiple myeloma) were JPY 2.9 billion (JPY -17.9 billion and -86.0% AER, -87.0% CER). The decrease was due to generic erosion in the U.S.

Sales of ADCETRIS (for malignant lymphomas) were JPY 54.3 billion (JPY +12.6 billion and +30.1% AER, +29.3% CER). The increase was led by strong growth in Growth and Emerging Markets.

Sales of ALUNBRIG (for small-cell lung cancer) were JPY 13.7 billion (JPY +4.0 billion and +41.2% AER, +36.2% CER). The increase benefited from strong demand across all regions.

Neuroscience

In Neuroscience, revenue was JPY 330.7 billion (JPY +28.4 billion and +9.4% AER, +3.2% CER).

Sales of VYVANSE/ELVANSE (for attention deficit hyperactivity disorder (“ADHD”)) were JPY 226.3 billion (JPY +15.0 billion and +7.1% AER, +0.7% CER). Despite the growth of the adult market and favorable foreign exchange rates, these impacts were predominantly offset by multiple generic entrants in the U.S. starting from late August of this year.

Sales of ADDERALL XR (for ADHD) were JPY 22.6 billion (JPY +10.1 billion and +80.3% AER, +68.1% CER). The increase was primarily due to a shortage of generic versions of the instant release formulation marketed by competitors in the U.S.

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Cost of Sales

Cost of Sales was JPY 664.7 billion (JPY +66.4 billion and +11.1% AER, +6.0% CER). The increase was primarily due to revenue growth in our five key business area with a change in product mix and the depreciation of Japanese yen as compared to the same period of the previous fiscal year. This was partially offset by a decrease in non-cash charges related to the unwind of the fair value step up on acquired inventories recognized in connection with the acquisition of Shire.

Selling, General and Administrative (SG&A) expenses

SG&A expenses were JPY 501.1 billion (JPY +20.9 billion and +4.3% AER, -0.8% CER). The increase was mainly due to the impact from the depreciation of Japanese yen.

Research and Development (R&D) expenses

R&D expenses were JPY 346.7 billion (JPY +48.9 billion and +16.4% AER, +9.6% CER). The increase was mainly due to various investments in pipeline programs and the impact from the depreciation of Japanese yen.

Amortization and Impairment Losses on Intangible Assets Associated with Products

Amortization and Impairment Losses on Intangible Assets Associated with Products was JPY 369.7 billion (JPY +96.0 billion and +35.1% AER, +25.8% CER). The increase was mainly due to an increase in impairment charges for certain assets related to in-process R&D and marketed products and an increase of amortization expenses due to the depreciation of Japanese yen. The JPY 115.8 billion impairment losses recorded in the current period primarily includes JPY 74.0 billion impairment charges for ALOFISEL (for complex Crohn's perianal fistulas) following topline results of phase 3 ADMIRE-CD II trial and JPY 28.5 billion impairment charges following a decision to voluntarily withdraw EXKIVITY (for non-small cell lung cancer) globally.

Other Operating Income

Other Operating Income was JPY 9.9 billion (JPY -3.6 billion and -26.7% AER, -27.6% CER).

Other Operating Expenses

Other Operating Expenses were JPY 110.2 billion (JPY +26.9 billion and +32.2% AER, +27.1% CER). The increase was primarily driven by increases in reserves and provisions, including for certain legal proceedings, and restructuring expenses.

Operating Profit

As a result of the above factors, Operating Profit was JPY 119.2 billion (JPY -135.7 billion and -53.2% AER, -50.6% CER).

Net Finance Expenses

Net Finance Expenses were JPY 81.8 billion (JPY +48.2 billion and +143.7% AER, +147.9% CER). The increase of Net Finance Expenses compared to the same period of the previous year was primarily due to a decrease in financial income reflecting gains from acquisitions of prior equity method companies and other income and gains recorded in the same period of the previous fiscal year.

Share of Profit of Investments Accounted for Using the Equity Method

Share of Profit of Investments Accounted for Using the Equity Method was JPY 1.6 billion (JPY +3.0 billion, compared to Share of Loss of Investments Accounted for Using the Equity Method of JPY 1.4 billion).

Income Tax (Expenses) Benefit

Income Tax Benefit was JPY 2.4 billion (JPY +55.7 billion, compared to Income Tax Expenses of JPY 53.3 billion, -86.0% CER). The increase was primarily due to a tax expense reduction of JPY 63.5 billion resulting from the reversal of the income taxes payable in excess of the settlement with Irish Revenue Commissioners with respect to a tax assessment related to the treatment of an acquisition break fee Shire received from AbbVie, Inc. (AbbVie) in 2014 as well as lower pretax earnings. These increases were partially offset by the tax charges from the write-down of deferred tax assets in the current period.

Net Profit for the Period

Net Profit for the Period was JPY 41.4 billion (JPY -125.3 billion and -75.2% AER, -77.8% CER).

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Core Results (April 1 to September 30, 2023)

Definition of Core financial measures and Constant Exchange Rate change

Takeda uses the concept of Core financial measures for measuring financial performance. These measures are not defined by International Financial Reporting Standards (IFRS).

Core Revenue represents revenue adjusted to exclude significant items unrelated to Takeda's core operations.

Core Operating Profit represents net profit adjusted to exclude income tax expenses, the share of profit or loss of investments accounted for using the equity method, finance expenses and income, other operating expenses and income, amortization and impairment losses on acquired intangible assets and other items unrelated to Takeda’s core operations, such as non-recurring items, purchase accounting effects and transaction related costs.

Core EPS represents net profit adjusted to exclude the impact of items excluded in the calculation of Core Operating Profit, and other non-operating items (e.g. amongst other items, fair value adjustments and the imputed financial charge related to contingent consideration) that are unusual, non-recurring in nature or unrelated to Takeda’s ongoing operations and the tax effect of each of the adjustments, divided by the average outstanding shares (excluding treasury shares) of the reporting periods presented.

Constant Exchange Rate (CER) change eliminates the effect of foreign exchange rates from year-over-year comparisons by translating Reported or Core results for the current period using corresponding exchange rates in the same period of the previous fiscal year.

Results of Core Operations

	Billion or percentage
	FY2022 H1		Change versus the same period of the previous fiscal year
		AER				CER
		Amount of Change		% change		% change
Core Revenue	1,974.8		126.9		6.4	%	1.4	%
Core Operating Profit	625.2		(36.4)		(5.8)	%	(9.5)	%
Core EPS (JPY)	288		(27)		(9.4)	%	(14.4)	%

All values are in Japanese Yen.

Core Revenue

Core Revenue for the six-month period ended September 30, 2023 was JPY 2,101.7 billion (JPY +126.9 billion and +6.4% AER, +1.4% CER). There were no significant items unrelated to Takeda’s core operations excluded from revenue in the current period or in the same period of the previous fiscal year, and, accordingly, Core Revenue for these periods is the same as Reported Revenue. Business momentum was led by Takeda’s Growth and Launch Products* which totaled JPY 875.9 billion (JPY +143.1 billion and +19.5% AER, +12.7% CER).

*    Takeda’s Growth and Launch Products

GI: ENTYVIO, ALOFISEL

Rare Diseases: TAKHZYRO, LIVTENCITY

PDT Immunology: Immunoglobulin products including GAMMAGARD LIQUID/KIOVIG, HYQVIA, and CUVITRU,

Albumin products including HUMAN ALBUMIN and FLEXBUMIN

Oncology: ALUNBRIG, EXKIVITY (Takeda decided to voluntarily withdraw the product globally)

Other: QDENGA

Core Operating Profit

Core Operating Profit for the current period was JPY 588.8 billion (JPY -36.4 billion and -5.8% AER, -9.5% CER). The decrease was primarily due to a change in product mix and investments in various pipeline programs and data and technology.

Core EPS

Core EPS for the current period was JPY 261 (JPY -27 and -9.4% AER, -14.4% CER).

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(2) Consolidated Financial Position

The amount of change from the previous fiscal year-end is presented based on Actual Exchange Rates.

Assets.

Total Assets as of September 30, 2023 were JPY 14,871.9 billion (JPY +914.1 billion). The increases of Goodwill, Property, Plant and Equipment, Inventories, and Intangible Assets (JPY +510.3 billion, JPY +202.9 billion, JPY +169.4 billion, and JPY +132.8 billion, respectively) were mainly due to the effect of foreign currency translation. These increases were partially offset by a decrease in Cash and Cash Equivalents (JPY -215.5 billion).

Liabilities.

Total Liabilities as of September 30, 2023 were JPY 7,800.9 billion (JPY +197.8 billion). Bonds and Loans were JPY 4,679.2 billion* (JPY +296.9 billion), which increased primarily due to the effect of foreign currency translation and the issuance of commercial paper. In addition, Other Financial Liabilities increased (JPY +162.6 billion) primarily due to increased lease liabilities in the U.S. These increases were partially offset by a decrease in Trade and Other Payables (JPY -228.2 billion) due to payments for the remaining upfront payment related to the acquisition of TAK-279 from Nimbus Therapeutics, LLC (Nimbus) and the exclusive license agreement with HUTCHMED (China) Limited (HUTCHMED).

* The carrying amount of Bonds was JPY 3,931.9 billion and Loans was JPY 747.4 billion as of September 30, 2023. Breakdown of Bonds and Loans' carrying amount is as follows.

Bonds:

Name of Bond<br> (Face Value if Denominated in<br> Foreign Currency)	Issuance	Maturity	Carrying Amount<br>(Billion JPY)
Unsecured US dollar denominated senior notes (USD 1,301 million)	June 2015	June 2025 ~<br>June 2045	194.8
Unsecured US dollar denominated senior notes (USD 3,000 million)	September 2016	September 2026	430.0
Unsecured Euro denominated senior notes<br>(EUR 3,000 million)	November 2018	November 2026 ~<br>November 2030	472.0
Unsecured US dollar denominated senior notes (USD 2,250 million)	November 2018	November 2023 ~<br>November 2028	333.9
Hybrid bonds (subordinated bonds)	June 2019	June 2079	499.2
Unsecured US dollar denominated senior notes (USD 7,000 million)	July 2020	March 2030 ~<br>July 2060	1,036.7
Unsecured Euro denominated senior notes<br>(EUR 3,600 million)	July 2020	July 2027 ~ <br>July 2040	565.8
Unsecured JPY denominated senior bonds	October 2021	October 2031	249.5
Commercial paper	September 2023	December 2023	150.0
Total			3,931.9

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Loans:

Name of Loan<br> (Face Value if Denominated in<br> Foreign Currency)	Execution	Maturity	Carrying Amount<br>(Billion JPY)
Syndicated loans	April 2016	April 2026	100.0
Syndicated loans	April 2017	April 2027	113.5
Syndicated loans (USD 1,500 million)	April 2017	April 2027	223.4
Syndicated loans	April 2023	April 2030	100.0
Bilateral loans	March 2016 ~ <br>March 2023	April 2024 ~ <br>March 2029	210.0
Other			0.5
Total			747.4

On April 26, 2023, Takeda repaid JPY 100.0 billion in Syndicated Loans falling due and on the same day entered into new Syndicated Loans of JPY 100.0 billion maturing on April 26, 2030. Following this, Takeda redeemed USD 1,000 million of unsecured senior notes issued in September 2016 on their maturity date of September 23, 2023. Furthermore, Takeda had short term commercial paper drawings outstanding of JPY 150.0 billion as at September 30, 2023.

Equity.

Total Equity as of September 30, 2023 was JPY 7,071.0 billion (JPY +716.4 billion). The increase of Other Components of Equity (JPY +779.8 billion) was mainly due to fluctuation in currency translation adjustments reflecting the depreciation of Japanese yen. This increase was partially offset by a decrease in Retained Earnings (JPY -95.1 billion) mainly due to the decrease of JPY 140.1 billion related to dividends payments while Net Profit for the Period contributed to an increase.

Consolidated Cash Flows

	Billion
	FY2022 H1
Net cash from (used in) operating activities	305.2
Net cash from (used in) investing activities	(121.9)
Net cash from (used in) financing activities	(267.6)
Net increase (decrease) in cash and cash equivalents	(84.3)
Cash and cash equivalents at the beginning of the year	849.7
Effects of exchange rate changes on cash and cash equivalents	32.7
Cash and cash equivalents at the end of the period	798.1

All values are in Japanese Yen.

The amount of change from the same period of the previous fiscal year is presented based on Actual Exchange Rates.

Net cash from operating activities

Net cash from operating activities for the current period was JPY 291.3 billion (JPY -13.9 billion). The decrease was due to unfavorable impacts from a lower net profit for the period adjusted for non-cash items and other adjustments, along with an increase in Income taxes paid. These were partially offset by a favorable net impact from Changes in assets and liabilities and other changes.

Net cash used in investing activities

Net cash used in investing activities was JPY 327.1 billion (JPY +205.2 billion). This increase was mainly due to an increase in Acquisition of intangible assets related to the acquisition of TAK-279 from Nimbus and the exclusive license agreement with HUTCHMED.

Net cash used in financing activities

Net cash used in financing activities was JPY 198.4 billion (JPY -69.2 billion). The decrease was mainly due to a net increase in commercial paper drawings of JPY 110.0 billion and the settlement of cross currency interest rate swaps related to bonds during

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the current period. These were partially offset by the redemption of USD 1,000 million of unsecured senior notes issued in September 2016 on their maturity date of September 23, 2023.

(3) Research & Development Activities and Results

Research and development expenses for the six-month period ended September 30, 2023 were JPY 346.7 billion.

Takeda’s R&D engine is focused on translating science into highly innovative, life-transformative medicines that make a critical difference to patients. Takeda supports dedicated R&D efforts across three areas: Innovative Biopharma, Plasma-Derived Therapies (“PDT”) and Vaccines. The R&D engine for Innovative Biopharma is the largest component of our R&D investment and has produced exciting new molecular entities (“NMEs”) that represent potential best-in-class and/or first-in-class medicines in areas of high unmet medical need across our core therapeutic areas (Gastrointestinal and inflammation, neuroscience, oncology, and rare genetics and hematology). We are working to harness the potential of cell and gene therapies by investing in new capabilities and next-generation platforms internally and through a network of partnerships. We are embracing data and digital technologies to improve the quality of innovation and accelerate execution.

Takeda’s pipeline is positioned to support both the near-term and mid- to long-term sustained growth of the company. Once first approval of a product is achieved, Takeda R&D is equipped to support geographic expansions of such approval and approvals in additional indications, as well as post-marketing commitment and potential additional formulation work. Takeda’s R&D team works closely with the commercial functions to maximize the value of marketed products and reflect commercial insights in its R&D strategies and portfolio.

Major progress on R&D events since April 2023 are listed as follows:

R&D pipeline

Gastrointestinal and Inflammation

In Gastrointestinal and Inflammation, Takeda focuses on delivering innovative, life-changing therapeutics for patients with gastrointestinal diseases, including those of the liver as well as other immune-mediated inflammatory diseases. Takeda is maximizing the potential of our inflammatory bowel disease (IBD) franchise around ENTYVIO, including development of a subcutaneous formulation and expansion into other indications such as active chronic pouchitis. Takeda is also expanding its position with GATTEX/REVESTIVE to support further potential geographic expansion. Furthermore, Takeda is progressing a pipeline built through in-house discovery, partnerships and business development, exploring opportunities in inflammatory diseases (IBD, celiac disease, psoriasis, psoriatic arthritis, system lupus erythematosus, others), select liver diseases, and motility disorders. Fazirsiran (TAK-999) is an example of an addition through partnership and a potential first-in-class RNAi for alpha-1 antitrypsin-deficiency associated liver disease in late-stage development. TAK-279 is an example of an acquisition through business development of a late-stage, potential best-in-class oral allosteric tyrosine kinase 2 (TYK2) inhibitor with potential to treat multiple immune-mediated inflammatory diseases.

ENTYVIO / Generic name: vedolizumab

–In April 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) accepted for review its Biologics License Application (BLA) resubmission for the investigational subcutaneous (SC) administration of ENTYVIO for maintenance therapy in adults with moderately to severely active ulcerative colitis (UC) after induction therapy with ENTYVIO intravenous (IV). The resubmission was intended to address FDA feedback in a December 2019 Complete Response Letter (CRL). Since receiving the CRL Takeda worked closely with the FDA to address the Agency’s feedback; and this resubmission package included additional data collected to investigate the use of subcutaneous administration of ENTYVIO. The contents of the letter were unrelated to the IV formulation of ENTYVIO, the clinical safety and efficacy data, and conclusions from the pivotal VISIBLE 1 trial supporting the ENTYVIO SC BLA. VISIBLE 1 assessed the safety and efficacy of a SC formulation of ENTYVIO as maintenance therapy in 216 adult patients with moderately to severely active UC who achieved clinical response at week 6 following two doses of open-label ENTYVIO IV therapy at weeks 0 and 2. The primary endpoint was clinical remission at week 52, which was defined as a total Mayo score of ≤2 and no subscore >1. In September 2023, Takeda announced that the FDA approved a SC administration of ENTYVIO for maintenance therapy in adults with moderately to severely active UC after induction therapy with ENTYVIO IV.

–In September 2023, Takeda announced that the FDA accepted for review its BLA for the investigational SC administration of ENTYVIO for maintenance therapy in adults with moderately to severely active Crohn’s disease (CD) after induction therapy with ENTYVIO IV. The BLA package is based on data from VISIBLE 2 trial that assessed the safety and efficacy of an SC formulation of ENTYVIO as maintenance therapy compared to placebo in 409 adult patients with moderately to severely active CD who achieved clinical response at week 6 following two doses of open-

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label ENTYVIO IV therapy at weeks 0 and 2. The primary endpoint was clinical remission at week 52, which was defined as CD Activity Index (CDAI) score ≤150.

–In September 2023, Takeda announced that it received an approval from the Japanese Ministry of Health, Labour and Welfare (MHLW) for a partial change to the marketing authorization status of ENTYVIO Pens for S.C. Injection 108 mg /Syringes for S.C. Injection 108 mg (ENTYVIO SC) as a maintenance therapy for moderate to severe active Crohn's disease (CD) with inadequate response to conventional treatment. This approval is based on the results of the MLN0002SC-3031 and MLN0002SC-3030 clinical trials, which are international Phase 3 trials that evaluated the efficacy and safety of ENTYVIO SC as a maintenance therapy in moderate to severe active CD.

ALOFISEL / Generic name: darvadstrocel

–In October 2023, Takeda announced that the Phase 3 ADMIRE-CD II study, assessing the efficacy and safety of ALOFISEL for the treatment of complex Crohn’s Perianal Fistulas (CPF), did not meet its primary endpoint of combined remission at 24 weeks, based on topline data. The safety profile for darvadstrocel was consistent with prior studies and there were no new safety signals identified. Full results of the study will be presented at a future medical meeting or published in a peer-reviewed journal. ALOFISEL is approved in the European Union (EU), Israel, Switzerland, Serbia, United Kingdom and Japan based on positive data from the previously completed ADMIRE-CD study.

Development Code: TAK-279

–In September 2023, Takeda announced positive topline results from its randomized, double-blind, placebo-controlled, multiple-dose Phase 2b trial evaluating TAK-279, an investigational oral allosteric tyrosine kinase 2 (TYK2) inhibitor with next generation selectivity, in patients with active psoriatic arthritis. The study met its primary endpoint with a significantly greater proportion of patients treated once-daily with TAK-279 achieving at least a 20 percent improvement in signs and symptoms of disease (American College of Rheumatology 20 response [ACR20]) at week 12 compared to placebo, supporting its potential as a highly selective oral option for patients with psoriatic arthritis. The safety and tolerability profile of TAK-279 in the Phase 2b trial was consistent with previous TAK-279 clinical trials. Analysis of the results are ongoing, and Takeda plans to present clinical results at an upcoming medical meeting. Based on the Phase 2b results, Takeda intends to initiate a Phase 3 development program of TAK-279 in psoriatic arthritis. Takeda also intends to initiate a Phase 3 development program of TAK-279 in plaque psoriasis in FY2023 and plans to evaluate TAK-279 in systemic lupus erythematosus, Crohn’s disease, ulcerative colitis and additional immune-mediated inflammatory diseases.

Development code: TAK-721 (Planned trade name: Eohilia) / Generic name: budesonide

–In September 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) accepted for review its New Drug Application (NDA) resubmission for TAK-721 (budesonide oral suspension) which is being investigated for the short-term treatment of eosinophilic esophagitis (EoE). The resubmission is intended to address previous FDA feedback to Takeda’s original NDA submission.

Neuroscience

In Neuroscience, Takeda is focusing its R&D investments on potentially transformative treatments for neurological and neuromuscular diseases of high unmet need and building its pipeline through a combination of in-house expertise and partnerships. By harnessing advances in disease biology understanding, translational tools, and innovative modalities, Takeda is primarily focusing on rare neurology, in particular, on potential investigative therapies for sleep-wake disorders such as narcolepsy and idiopathic hypersomnia with a franchise of orexin-2 receptor agonists (TAK-861, danavorexton (TAK-925), etc.), rare epilepsies with soticlestat (TAK-935) and central nervous system (CNS) and somatic symptoms of Hunter Syndrome with pabinafusp alfa (TAK-141). Additionally, Takeda makes targeted investments to investigate well-defined segments of neuromuscular diseases, neurodegenerative diseases and movement disorders.

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Oncology

In Oncology, we aspire to cure cancer, with inspiration from patients and innovation from everywhere. We are focused on: (1) building on our legacy in hematologic malignancies with marketed products (NINLARO, ADCETRIS, and ICLUSIG, etc.) and pipeline programs; (2) growing a solid tumor portfolio with marketed lung cancer product (ALUNBRIG), and development programs in other areas, including colorectal cancer with fruquinitinib (TAK-113); and (3) advancing a cutting-edge pipeline focused on the power of innate immunity.

CABOMETYX / Generic name: cabozantinib

–In August 2023, Takeda announced that, in the CONTACT-02 global phase 3 clinical trial, statistically significant difference in progression-free survival (PFS) was observed, demonstrating a clinically meaningful improvement. The CONTACT-02 trial compared the combination therapy of CABOMETYX and atezolizumab, an anti-PD-L1 (Programmed Death-Ligand 1) humanized monoclonal antibody, with a second novel hormonal therapy (either abiraterone and prednisone or enzalutamide) in patients with metastatic castration-resistant prostate cancer and measurable soft tissue disease who had received prior treatment with one form of hormonal therapy. The safety profiles of CABOMETYX and atezolizumab observed in this trial were consistent with their known safety profiles as monotherapies, and no new safety concerns were identified with the combination regimen. For the other primary endpoint of overall survival (OS) that occurred at the same time as the primary analysis of PFS, data were immature at this prespecified interim analysis. Therefore, the trial will continue to the next analysis of OS.

ADCETRIS / Generic name: brentuximab vedotin

–In October 2023, Takeda announced that the European Commission (EC) approved ADCETRIS in combination with doxorubicin, vinblastine and dacarbazine (AVD) to treat adult patients with previously untreated CD30+ Stage III Hodgkin lymphoma. The decision follows a positive opinion from the Committee for Medicinal Products for Human Use (CHMP) in September, 2023. The approval is based on the results of the randomized Phase 3 ECHELON-1 trial designed to compare ADCETRIS plus AVD to doxorubicin, bleomycin, vinblastine, and dacarbazine (ABVD) as a therapy in adult patients with previously untreated Stage III or IV Hodgkin lymphoma. The trial met its primary endpoint of modified progression-free survival (PFS), as well as its key secondary endpoint of overall survival (OS), demonstrating a statistically significant improvement in OS in adult patients with previously untreated Stage III or IV classical Hodgkin lymphoma treated with ADCETRIS+AVD. The safety profile of ADCETRIS was consistent with previous studies, and no new safety signals were observed.

NINLARO / Generic name: ixazomib

–In September 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of Health, Labour and Welfare (MHLW) for NINLARO capsules 0.5 mg as an additional dosage form of NINLARO (Capsules 2.3 mg/3 mg/4 mg). Aiming to achieve more appropriate dose adjustment in maintenance therapy for patients with multiple myeloma, Takeda filed this application to provide patients with a new treatment option (1.5 mg dose (0.5 mg/capsule x 3)) using a low-dose formulation of NINLARO.

EXKIVITY / Generic name: mobocertinib

–In October 2023, Takeda announced that, following discussions with the U.S. Food and Drug Administration (FDA), it will be working with the FDA towards a voluntary withdrawal of EXKIVITY in the U.S. for adult patients with epidermal growth factor receptor (EGFR) exon20 insertion mutation-positive (insertion+) locally advanced or metastatic non-small cell lung cancer (NSCLC) whose disease has progressed on or after platinum-based chemotherapy. Takeda intends to similarly initiate voluntary withdrawal globally where EXKIVITY is approved and is working with regulators in other countries where it is currently available on next steps. This decision was based on the outcome of the Phase 3 EXCLAIM-2 confirmatory trial, which did not meet its primary endpoint and thus did not fulfill the confirmatory data requirements of the accelerated approval granted by the U.S. FDA nor the conditional marketing approvals granted in other countries. The EXCLAIM-2 trial was a Phase 3, multicenter, open-label study designed to investigate the safety and efficacy of EXKIVITY as a monotherapy versus platinum-based chemotherapy in first-line EGFR exon20 insertion+ locally advanced or metastatic NSCLC. No new safety signals were observed in the EXCLAIM-2 trial. Full data from the trial will be presented at an upcoming medical meeting or published in a peer-reviewed journal.

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Development code: TAK-113 / Generic name: fruquintinib

–In May 2023, Takeda and HUTCHMED (China) Limited announced that the U.S. Food and Drug Administration (FDA) granted priority review of the New Drug Application (NDA) for fruquintinib, a highly selective and potent inhibitor of vascular endothelial growth factor receptors (VEGFR) -1, -2 and -3 for the treatment of adult patients with previously treated metastatic colorectal cancer (CRC). If approved, fruquintinib will be the first and only highly selective inhibitor of all three VEGF receptors approved in the U.S. for previously treated metastatic CRC. The NDA for fruquintinib includes results from the Phase 3 FRESCO-2 trial conducted in the US, Europe, Japan and Australia along with data from the Phase 3 FRESCO trial conducted in China. The Prescription Drug User Fee Act (PDUFA) goal date assigned by the FDA for this NDA is November 30, 2023.

–In June 2023, Takeda and HUTCHMED (China) Limited announced that the European Medicines Agency (EMA) validated and accepted for regulatory review the marketing authorization application (MAA) for fruquintinib for the treatment of adult patients with previously treated metastatic CRC. If approved, fruquintinib will be the first and only highly selective and potent inhibitor of VEGFR -1, -2 and -3 approved in the European Union (EU) for previously treated metastatic CRC. The MAA for fruquintinib includes results from the global Phase 3 FRESCO-2 clinical trial along with data from the Phase 3 FRESCO clinical trial.

–In June 2023, Takeda and HUTCHMED (China) Limited announced that results of the Phase 3 FRESCO-2 study evaluating fruquintinib in patients with previously treated metastatic CRC were published in The Lancet. FRESCO-2 is a global Phase 3 clinical trial (MRCT) conducted in the U.S., Europe, Japan and Australia investigating fruquintinib plus best supportive care (BSC) vs placebo plus BSC in patients with previously treated metastatic CRC. The FRESCO-2 study met its primary and key secondary endpoints, demonstrating that treatment with fruquintinib resulted in a statistically significant and clinically meaningful improvement in overall survival (OS) and progression-free survival (PFS), respectively. The safety profile of fruquintinib in FRESCO-2 was consistent with previously reported fruquintinib studies.

–In September 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of Health, Labour and Welfare (MHLW) for fruquintinib for the treatment of previously treated metastatic colorectal cancer. The NDA for fruquintinib is based on the global Phase 3 FRESCO-2 clinical trial and the Phase 3 FRESCO clinical trial.

Rare Genetics and Hematology

In Rare Genetics and Hematology, Takeda focuses on several areas of high unmet medical need. In hereditary angioedema, Takeda aspires to transform the treatment paradigm, including through TAKHZYRO, with continued investment in lifecycle management programs. In rare hematology, Takeda focuses on addressing today’s needs in the treatment of bleeding disorders, including through ADVATE and ADYNOVATE/ADYNOVI, as well as on the development of pipeline assets including apadamtase alfa/cinaxadamtase alfa (TAK-755) for the treatment of immune thrombotic thrombocytopenic purpura (iTTP) and congenital thrombotic thrombocytopenic purpura (cTTP). In addition, Takeda aims to redefine the management of post-transplant cytomegalovirus (CMV) infection/disease with LIVTENCITY. Takeda commits to fulfilling our vision to deliver life-transforming medicines to patients with rare diseases.

Development code: TAK-755 / Generic name: apadamtase alfa/cinaxadamtase alfa

–In May 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) accepted Takeda’s Biologics License Application (BLA) for TAK-755, an enzyme replacement therapy for the treatment of congenital thrombotic thrombocytopenic purpura (cTTP), an ADAMTS13 deficiency disorder. The TAK-755 application was accepted by the FDA on May 16th and has been granted Priority Review. FDA also granted TAK-755 Rare Pediatric Disease (RPD) designation for cTTP. TAK-755 has previously received Fast Track Designation and Orphan Drug Designation in cTTP. The BLA is supported by the totality of the evidence provided by efficacy, pharmacokinetic, safety and tolerability data from the first randomized, controlled trial in cTTP, and supported by long-term safety and efficacy data from a continuation study. If approved, TAK-755 would be the first and only recombinant ADAMTS13 (rADAMTS13) replacement therapy for cTTP, a disorder with considerable unmet patient need. Takeda is also investigating the safety, efficacy and pharmacokinetics of TAK-755 treatment in immune-mediated TTP (iTTP).

–In June 2023, Takeda presented favorable interim results from a global pivotal Phase 3 randomized, controlled, open-label, crossover trial evaluating the safety and efficacy of TAK-755 replacement therapy for the prophylactic treatment of cTTP, and pharmacokinetics (PK) characteristics of TAK-755, as well as long-term data on TAK-755 prophylaxis from a Phase 3b continuation study at the International Society on Thrombosis and Haemostasis (ISTH) 2023 Congress. In the pivotal trial, no patient had an acute TTP event while receiving TAK-755 prophylactic treatment. TAK-755 also

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reduced the incidence of thrombocytopenia by 60%, as compared to plasma-based therapy (hazard ratio [HR] 0.40; 95% confidence interval [CI]; 0.3- 0.7). Treatment-emergent adverse events (TEAEs) were reported in 10.3% of patients ages 12-68 receiving TAK-755 compared to 50% of patients receiving plasma-based therapy, demonstrating a favorable safety and tolerability profile with a potential safety advantage over plasma-based therapies. PK characteristics of ADAMTS13 after a single infusion (0-168 hours) were evaluated and compared to plasma-based therapy in 36 cTTP patients aged 12 and older. Patients receiving TAK-755 achieved a five-fold increase in their ADAMTS13 activity levels compared to those receiving plasma-based therapy (Cmax 100% activity for TAK-755 vs. 19% activity for plasma-based therapy) and lower variability (23.8% vs. 56% coefficient of variation [CV], respectively). Also, the results of an interim analysis of the Phase 3b continuation study, evaluating the safety and efficacy of long-term TAK-755 prophylaxis in 29 patients with cTTP, demonstrated a consistently favorable safety profile with TAK-755 prophylaxis and no development of neutralizing antibodies. Zero acute TTP events occurred during TAK-755 prophylaxis, and the incidence rates of subacute TTP events and TTP manifestations were comparable to those with TAK-755 prophylaxis in the pivotal study.

–In August 2023, Takeda announced that it filed an application for manufacturing and marketing approval for TAK-755 for the expected indication of cTTP with the Japanese Ministry of Health, Labour and Welfare (MHLW). The application is based on the interim analysis of the global Phase 3 clinical trial 281102 primarily focusing on patients with cTTP, including five Japanese individuals, and the Phase 3b continuation trial TAK-755-3002. In these trials, TAK-755 was evaluated for its efficacy and safety as a treatment for cTTP.

ADYNOVATE/ADYNOVI / Generic name: antihemophilic factor (recombinant), PEGylated

–In June 2023, Takeda announced that it received an approval from the Japanese Ministry of Health, Labour and Welfare (MHLW) for a partial change in approved items of the manufacturing and marketing approval of ADYNOVATE for dosage and administration. This approval will contribute driving personalized treatments by adjusting dosage and administration including dosing amount and intervals, depending on individual patient’s clinical presentation and activity level. The approval is based primarily on the results of the global Phase 3 CONTINUATION study and Phase 3 PROPEL study conducted outside of Japan.

OBIZUR / Generic name: Susoctocog Alfa (recombinant)

–In June 2023, Takeda announced that it has submitted a marketing authorization application to the Japanese Ministry of Health, Labour and Welfare (MHLW) for Susoctocog Alfa (recombinant) for the control of bleeding in patients with acquired hemophilia A (AHA). The application is based primarily on a Japanese Phase 2/3 trial in adult Japanese patients with AHA and a Phase 2/3 trial conducted outside of Japan in non-Japanese adult patients with AHA.

Plasma-Derived Therapies (PDT)

Takeda has created a dedicated PDT business unit with a focus to manage the business end-to-end, from plasma collection to manufacturing, R&D, and commercialization. In PDT, we aspire to develop life-saving plasma derived treatments which are essential for patients with a variety of rare and complex chronic diseases. The dedicated R&D organization in PDT is charged with maximizing the value of existing therapies, identifying new targeted therapies, and optimizing efficiencies of current product manufacturing. Near-term, our priority is focused on delivering value from our broad immunoglobulin portfolio (HYQVIA, CUVITRU, GAMMAGARD and GAMMAGARD S/D) through pursuit of new indications, geographic expansions, and enhanced patient experience through integrated healthcare technologies. In our hematology and specialty care portfolio, our priority is pursuing new indication and formulation development opportunities for PROTHROMPLEX (4F-PCC), FEIBA, CEPROTIN and ARALAST. Additionally, we are developing next generation immunoglobulin products with 20% fSCIg (TAK-881), IgG Low IgA (TAK-880) and pursuing other early stage opportunities (e.g. hypersialylated Immunoglobulin (hsIgG)) that would add to our diversified commercial portfolio of more than 20 therapeutic products distributed worldwide.

HYQVIA / Generic name: Immunoglobulin (IG) Infusion 10% (Human) w/ Recombinant Human Hyaluronidase for subcutaneous administration

–In April 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) approved a supplemental biologics license application (sBLA) to expand the use of HYQVIA to treat primary immunodeficiency (PI) in children 2-16 years old. The FDA approval of HYQVIA for the treatment of PI in pediatric patients was based on evidence from a pivotal, prospective, open-label, non-controlled Phase 3 clinical trial that included 44 PI patients between the ages of 2 and 16. During the 12-month trial period, HYQVIA was shown to be efficacious with respect to the occurrence of acute serious bacterial infections (aSBIs), a primary endpoint. The mean aSBI rate per year was 0.04 and was statistically significantly lower (with an upper 1-sided 99% confidence interval of 0.21, p<0.001) than the predefined success rate of less than one aSBI per subject per year, favoring efficacy of HYQVIA treatment in pediatric subjects with PI diseases. Results from

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the interim data analysis, where all subjects completed 12 months of participation (one year of observation period) in the study, indicated similar safety profiles to adults.

–In June 2023, Takeda announced full results from the pivotal Phase 3 ADVANCE-CIDP 1 clinical trial investigating HYQVIA as maintenance therapy in adult patients with chronic inflammatory demyelinating polyneuropathy (CIDP). ADVANCE-CIDP 1 is a Phase 3, prospective, randomized, double-blind, multicenter, placebo-controlled study in which adults with stable CIDP on intravenous immunoglobulin (IVIG) were randomized 1:1 to be switched to HYQVIA (n=62) or placebo (n=70) and received their assigned treatment for six months or until relapse or study withdrawal. The primary endpoint was proportion of participants who experienced a relapse defined as worsening of CIDP symptoms as measured by Inflammatory Neuropathy Cause and Treatment (INCAT). Secondary endpoints included patient proportion experiencing functional worsening, time to relapse, change from pre-subcutaneous treatment baseline in Rasch-built Overall Disability Scale (R-ODS) centile score and safety. Results showed a clinically significant reduction in relapse rate with HYQVIA vs placebo (9.7% vs. 31.4%, respectively; p=0.0045) and other analysis showed delayed time to relapse with HYQVIA vs. placebo. Favorable data across other endpoints from the study and favorable tolerability were also observed. These findings were presented at the 2023 Peripheral Nerve Society (PNS) Annual Meeting in Denmark in June 2023, and simultaneously published in the Journal of the Peripheral Nervous System (JPNS).

CEPROTIN / Generic name: Human Dry Protein C Concentrate (Development code: TAK-662)

–In April 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of Health, Labour and Welfare (MHLW) for manufacturing and marketing approval of human dry protein C concentrate (TAK-662) for the treatment of venous thromboembolism and purpura fulminans caused by congenital protein C deficiency, as well as for the suppression of thrombi. The application is based primarily on a Phase 1/2 trial in Japanese patients with congenital protein C deficiency and two Phase 2/3 trials (IMAG-098 and 400101) outside of Japan in patients with congenital protein C deficiency. In these trials, TAK-662 demonstrated its efficacy and safety as a treatment for congenital protein C deficiency.

CUVITRU / Generic name: Immunoglobulin (IG) Infusion 20% (Human) for subcutaneous administration

–In September 2023, Takeda announced that the Japanese Ministry of Health, Labour and Welfare (MHLW) approved the use of CUVITRU in patients aged 2 years and older with agammaglobulinemia or hypogammaglobulinemia, disorders characterized by very low or absent levels of antibodies and an increased risk of serious recurring infection caused by primary immunodeficiency (PID) or secondary immunodeficiency (SID). The approval marks Takeda’s first subcutaneous immunoglobulin (SCIG) therapy for patients in Japan. The approval is based on results from a Phase 3 clinical trial that evaluated the efficacy, safety, tolerability and pharmacokinetics of CUVITRU in Japanese patients with PID, as well as two Phase 2/3 clinical trials conducted in patients with PID in North America and Europe. Results from the clinical trial in 17 patients in Japan confirmed its efficacy and safety profile. No serious or severe adverse events were reported, and CUVITRU was well-tolerated. The most frequently reported adverse reactions were headache and injection site swelling in four patients (23.5%) and injection site erythema in three patients (17.6%) during CUVITRU treatment. Previously reported clinical trial results also confirmed the efficacy and safety of CUVITRU.

Vaccine

In Vaccines, Takeda is applying innovation to tackle some of the world’s most challenging infectious diseases such as dengue (QDENGA (development code: TAK-003)), COVID-19 (NUVAXOVID), and zika (TAK-426). To support the expansion of our pipeline and the development of our programs, we have entered into partnerships with government organizations in Japan and the U.S., and leading global institutions. Such partnerships have been essential in building the critical capabilities that will be necessary to deliver on our programs and realize their full potential.

QDENGA / Generic name: Dengue tetravalent vaccine [live, attenuated] (Development code: TAK-003)

–In July 2023, Takeda announced that it voluntarily withdrew the U.S. Biologics License Application (BLA) for TAK-003, following discussions with the U.S. Food and Drug Administration (FDA) on aspects of data collection, which cannot be addressed within the current BLA review cycle. The future plan for TAK-003 in the U.S. will be further evaluated given the need for travelers and those living in dengue-endemic areas of the U.S., such as Puerto Rico. The efficacy and safety profiles of TAK-003 have been demonstrated through a robust clinical trial program, including a 4.5-year Phase 3 study of over 20,000 children and adolescents living in eight dengue endemic areas. The study was designed per World Health Organization (WHO) guidance for a second-generation dengue vaccine, and it considered the

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need to achieve high levels of subject retention and protocol compliance in endemic regions. The vaccine is approved in multiple endemic and non-endemic countries, with more approvals expected over the coming years.

–In October 2023, Takeda announced that the WHO Strategic Advisory Group of Experts on Immunization (SAGE) shared recommendations for use of QDENGA.

SAGE made the following recommendations:

–The vaccine to be considered for introduction in settings with high dengue disease burden and high transmission intensity to maximize the public health impact and minimize any potential risk in seronegative persons.

–The vaccine to be introduced to children aged 6 to 16 years of age. Within this age range, the vaccine should be introduced about 1-2 years prior to the age-specific peak incidence of dengue-related hospitalizations. The vaccine should be administered in a 2-dose schedule with a 3-month interval between doses.

–The vaccine introduction should be accompanied by a well-designed communication strategy and community engagement.

SAGE reviewed data across 19 Phase 1, 2 and 3 trials with more than 28,000 children and adults, including the pivotal Phase 3 Tetravalent Immunization against Dengue Efficacy Study (TIDES) trial, which was designed according to the WHO’s guidance for a second-generation dengue vaccine.

The WHO will consider the SAGE recommendation and is expected to update its position paper on dengue vaccines to include final guidance on the use of QDENGA in public vaccination programs.

Building a sustainable research platform / Enhancing R&D collaboration

In addition to our concentrated efforts to increase our in-house R&D capabilities, external partnerships with third-party partners are a key component of our strategy for enhancing our R&D pipeline. Our strategy to expand and diversify our external partnerships allows us to take part in research of a wide variety of new products and increases the chances that we will be able to take part in a major research-related breakthrough.

–In August 2023, Takeda announced that it entered into an exclusive licensing agreement with ImmunoGen, Inc. (ImmunoGen) to develop and commercialize mirvetuximab soravtansine-gynx (MIRV) for the Japanese market. MIRV is an intravenous injection antibody-drug conjugate (ADC), in which a microtubule inhibitor is linked to an anti-folate receptor-α (FRα) antibody. It is the first ADC developed for the treatment of ovarian cancer. MIRV is approved under accelerated approval in the U.S. for the treatment of adult patients with FRα positive, platinum-resistant epithelial ovarian, fallopian tube, or primary peritoneal cancer, who have received one to three prior systemic treatment regimens. MIRV was the first medicine to show a significant prolongation of overall survival (OS) compared with conventional chemotherapy for the treatment of platinum-resistant relapsed or refractory ovarian cancer in a phase 3 MIRASOL study, conducted outside of Japan.

3. Material Contracts

There were no material contracts executed during the three-month period ended September 30, 2023.

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III. Information on the Company

1. Information on the Company’s Shares

(1) Total number of shares and other related information

1) Total number of shares

Class	Total number of shares<br>authorized to be issued (Shares)
Common stock	3,500,000,000
Total	3,500,000,000

2) Number of shares issued

Class	Number of shares outstanding<br><br>(As of September 30, 2023)	Number of shares outstanding as of the filling date<br><br>(October 30, 2023)	Stock exchange on which the Company is listed	Description
Common stock	1,582,373,225	1,582,373,225	Tokyo (Prime Market), Nagoya (Premier Market), Fukuoka, Sapporo, and New York	The number of shares per one unit of shares is 100 shares.
Total	1,582,373,225	1,582,373,225	—	—

(Note1)    The Company's American Depositary Shares (ADS) are listed on the New York Stock Exchange.

(Note2)    The number of shares outstanding as of the filing date does not include shares issued upon exercise of stock acquisition rights from October 1, 2023 to the filing date of Quarterly Securities Report (October 30, 2023).

(2) Status of stock acquisition rights

1) Contents of stock option plans

Not applicable.

2) Status of other stock acquisition rights

Not applicable.

(3) Exercise status of bonds with stock acquisition rights containing a clause for exercise price adjustments

Not applicable.

(4) Changes in the total number of issued shares and the amount of share capital and capital reserve

Date	Change in the total number of issued shares<br>(Thousand of shares)	Balance of the total number of issued shares (Thousand of shares)	Change in share capital JPY (millions)	Balance of share capital<br>JPY (millions)	Change in capital reserve JPY (millions)	Balance of capital reserve<br>JPY (millions)
From July 1, 2023 to September 30, 2023<br><br>(Note1)	45	1,582,373	92	1,676,503	92	1,668,515

(Note)    The increases are due to the exercise of stock acquisition rights.

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(5) Major shareholders

		As of September 30, 2023
Name	Address	Number of Shares Held (Thousands of Shares)	Percentage of Total Number of Shares Issued (Excluding Treasury Stocks) (%)
The Master Trust Bank of Japan, Ltd. (Trust account)	11-3, Hamamatsucho 2-chome, Minato-ku, Tokyo	261,049	16.58
Custody Bank of Japan, Ltd. (Trust account)	8-12, Harumi 1-chome, Chuo-ku, Tokyo	85,912	5.46
The Bank of New York Mellon as depositary bank for depositary receipt holders<br>(Standing proxy: Sumitomo Mitsui Banking Corporation)	240 Greenwich Street, 8th Floor West, New York, NY 10286 U.S.A.<br>(1-2, Marunouchi 1-chome, Chiyoda-ku, Tokyo)	70,909	4.50
JP Morgan Chase Bank 385632<br>(Standing proxy: Settlement & Clearing Services Department, Mizuho Bank, Ltd.)	25 Bank Street, Canary Wharf, London, E14 5JP, United Kingdom<br>(15-1, Konan 2-chome, Minato-ku, Tokyo)	54,800	3.48
State Street Bank West Client-Treaty 505234<br>(Standing proxy: Settlement & Clearing Services Department, Mizuho Bank, Ltd.)	1776 Heritage Drive, North Quincy, MA 02171, U.S.A.<br>(15-1, Konan 2-chome, Minato-ku, Tokyo)	32,706	2.08
JPMorgan Securities Japan Co., Ltd.	7-3, Marunouchi 2-chome, Chiyoda-ku, Tokyo	32,250	2.05
Nippon Life Insurance Company<br>(Standing proxy: The Master Trust Bank of Japan, Ltd.)	6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo<br>(11-3, Hamamatsucho 2-chome, Minato-ku, Tokyo)	24,752	1.57
SMBC Nikko Securities Inc.	3-1, Marunouchi 3-chome, Chiyoda-ku, Tokyo	21,879	1.39
SSBTC Client Omnibus Account (Standing proxy: The Hongkong and Shanghai Banking Corporation Limited Tokyo Branch	One Congress Street, Suite 1, Boston MA USA 02111<br>(11-1, Nihombashi 3-chome, Chuo-ku, Tokyo)	21,590	1.37
JP Morgan Chase Bank 385781<br>(Standing proxy: Settlement & Clearing Services Department, Mizuho Bank, Ltd.)	25 Bank Street, Canary Wharf, London, E14 5JP, United Kingdom<br>(15-1, Konan 2-chome, Minato-ku, Tokyo)	20,711	1.32
Total		626,558	39.78

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(6) Information on voting rights

1) Total number of shares

		As of September 30, 2023
Classification		Number of shares<br>(Shares)				Number of voting rights (Units)		Description
Shares without voting rights				—		—		—
Shares with restricted voting rights<br>(Treasury stock and other)				—		—		—
Shares with restricted voting rights<br>(Others)				—		—		—
Shares with full voting rights<br>(Treasury stock and other)		(Treasury stock)<br>  Common stock		7,511,300		—		—
	(Crossholding stock)<br>  Common stock		287,000		—		—
Shares with full voting rights<br>(Others)		Common stock		1,573,171,200		15,731,712		—
Shares less than one unit		Common stock		1,403,725		—		Shares less than one unit<br>(100 shares)
Number of issued shares				1,582,373,225		—		—
Total number of voting rights				—		15,731,712		—

(Note1)    "Shares with full voting rights (Others)" includes 3,630,200 (voting rights: 36,302) and 2,257,800 (voting rights: 22,578) of the shares held by the ESOP and BIP trust, respectively.

(Note2)    "Shares less than one unit" includes 90 of the shares as the treasury stock, and 139 and 219 of the shares held by the ESOP and BIP trust, respectively.

(Note3)    On July 7, 2023, Takeda conducted the disposal of 13,958,202 treasury shares based on the resolution made on June 9, 2023 by Christophe Weber, Representative Director and Chief Executive Officer, for the purpose of providing the Company's ADS to group employees overseas under the long-term incentive plan.

2) Treasury stock and other

	As of September 30, 2023
Name of shareholders	Address	Number of shares held under own name (Shares)	Number of shares held under the name of others (Shares)	Total shares held (Shares)	Percentage of total issued shares issued (%)
(Treasury stock)
Takeda Pharmaceutical Company Limited	1-1, Doshomachi 4-chome, Chuo-ku, Osaka	7,511,300	—	7,511,300	0.47
(Crossholding stock)
Amato Pharmaceutical Products, Ltd.	5-3, Shinsenri Higashi-machi 1-chome, Toyonaka-city, Osaka	275,000	—	275,000	0.02
Watanabe Chemical, Co., Ltd.	6-1, Hiranomachi 3-chome, Chuo-ku, Osaka-city, Osaka	12,000	—	12,000	0.00
Total		7,798,300	—	7,798,300	0.49

(Note)    In addition to 90 shared of the above treasury stock and shares less than one unit, 3,630,339 of the shares held by the ESOP trust and 2,258,019 of the shares held by the BIP trust are included in treasury stock on the condensed interim consolidated financial statements.

2. Members of the Board of Directors

No changes from the latest Annual Securities Report.

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IV. Financial Information

Basis of Preparation of the Condensed Interim Consolidated Financial Statements

Takeda has prepared the condensed interim consolidated financial statements in accordance with IAS 34 “Interim Financial Reporting” based on the provision of Article 93 of Ordinance on Terminology, Forms and Preparation Methods of Quarterly Consolidated Financial Statements (Ordinance of the Ministry of Finance No. 64, 2007 in Japan).

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1. Condensed Interim Consolidated Financial Statements

(1) Condensed Interim Consolidated Statements of Profit or Loss

		(millions, except per share data)
	Six-month Period Ended September 30,
		2022	2022	2023
Revenue		1,974,771	1,002,307	1,043,089
Cost of sales		(598,327)	(305,445)	(343,582)
Selling, general and administrative expenses		(480,214)	(248,734)	(252,952)
Research and development expenses		(297,752)	(154,145)	(183,946)
Amortization and impairment losses on intangible assets associated with products		(273,643)	(142,366)	(240,242)
Other operating income		13,476	7,997	5,670
Other operating expenses		(83,359)	(55,177)	(77,379)
Operating profit (loss)		254,953	104,438	(49,342)
Finance income		75,707	14,782	9,359
Finance expenses		(109,272)	(53,803)	(58,022)
Share of profit (loss) of investments accounted for using the equity method		(1,366)	(869)	2,025
Profit (loss) before tax		220,022	64,549	(95,980)
Income tax (expenses) benefit		(53,269)	(2,817)	48,009
Net profit (loss) for the period		166,753	61,732	(47,971)
Attributable to:
Owners of the Company		166,756	61,742	(48,030)
Non-controlling interests		(3)	(10)	59
Net profit (loss) for the period		166,753	61,732	(47,971)
Earnings per share ()
Basic earnings (loss) per share		107.62	39.77	(30.68)
Diluted earnings (loss) per share		106.88	39.48	(30.68)

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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(2) Condensed Interim Consolidated Statements of Comprehensive Income

	(millions)
	Six-month Period Ended September 30,	Three-month Period Ended September 30,
	2022	2022	2023
Net profit (loss) for the period	166,753	61,732	(47,971)
Other comprehensive income (loss)
Items that will not be reclassified to profit or loss:
Changes in fair value of financial assets measured at fair value through other comprehensive income	5,284	5,464	(7,654)
Remeasurement of defined benefit pension plans	13,395	2,862	2,954
	18,679	8,326	(4,701)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations	1,035,192	312,421	185,281
Cash flow hedges	(33,200)	(7,727)	9,006
Hedging cost	(22,749)	4,666	(10,438)
Share of other comprehensive loss of investments accounted for using the equity method	(1,085)	(445)	(88)
	978,158	308,915	183,761
Other comprehensive income for the period, net of tax	996,837	317,241	179,061
Total comprehensive income for the period	1,163,590	378,973	131,090
Attributable to:
Owners of the Company	1,163,535	378,964	131,027
Non-controlling interests	55	9	62
Total comprehensive income for the period	1,163,590	378,973	131,090

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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(3) Condensed Interim Consolidated Statements of Financial Position

		(millions)
	Note	As of March 31, 2023
ASSETS
Non-current assets:
Property, plant and equipment		1,691,229
Goodwill		4,790,723
Intangible assets		4,269,657
Investments accounted for using the equity method		99,174
Other financial assets		279,683
Other non-current assets		63,325
Deferred tax assets		366,003
Total non-current assets		11,559,794
Current assets:
Inventories		986,457
Trade and other receivables		649,429
Other financial assets		20,174
Income taxes receivable		32,264
Other current assets		160,868
Cash and cash equivalents		533,530
Assets held for sale		15,235
Total current assets		2,397,956
Total assets		13,957,750

All values are in Japanese Yen.

LIABILITIES AND EQUITY
LIABILITIES
Non-current liabilities:
Bonds and loans	9	4,042,741	4,404,363
Other financial liabilities		534,269	574,874
Net defined benefit liabilities		127,594	134,953
Income taxes payable		24,558	4,025
Provisions		55,969	14,958
Other non-current liabilities		65,389	71,354
Deferred tax liabilities		270,620	228,719
Total non-current liabilities		5,121,138	5,433,247
Current liabilities:
Bonds and loans	9	339,600	274,841
Trade and other payables		649,233	421,078
Other financial liabilities		185,537	307,543
Income taxes payable		232,377	130,218
Provisions		508,360	657,657
Other current liabilities		566,689	576,279
Liabilities held for sale		144	—
Total current liabilities		2,481,940	2,367,617
Total liabilities		7,603,078	7,800,864

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		(millions)
	Note	As of March 31, 2023
EQUITY
Share capital		1,676,345
Share premium		1,728,830
Treasury shares		(100,317)
Retained earnings		1,541,146
Other components of equity		1,508,119
Equity attributable to owners of the Company		6,354,122
Non-controlling interests		549
Total equity		6,354,672
Total liabilities and equity		13,957,750

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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(4) Condensed Interim Consolidated Statements of Changes in Equity

Six-month period ended September 30, 2022 (From April 1 to September 30, 2022)

				(millions)
			Note	Equity attributable to owners of the Company															Non-<br>controlling<br>interests	Total<br>equity
	Share<br>capital			Sharepremium	Treasury<br>shares	Retained<br>earnings		Other components of equity										Total <br>equity attributable to owners of the Company
		Exchange<br>differences<br>on translation<br>of foreign<br>operations					Cash flow<br>hedges		Hedging<br>cost		Remeasurements of defined benefit pension plans		Total <br>other components of equity
As of April 1, 2022				1,676,263	1,708,873	(116,007)		1,479,716		984,141		22,068		(65,901)	(6,135)	—	934,173		5,683,019	504	5,683,523
Effect of hyperinflation								(1,960)		4,121							4,121		2,161		2,161
Restated opening balance				1,676,263	1,708,873	(116,007)		1,477,756		988,263		22,068		(65,901)	(6,135)	—	938,294		5,685,180	504	5,685,684
Net profit for the period								166,756									—		166,756	(3)	166,753
Other comprehensive income (loss)										1,034,071		5,262		(33,200)	(22,749)	13,395	996,779		996,779	58	996,837
Comprehensive income (loss) for the period				—	—	—		166,756		1,034,071		5,262		(33,200)	(22,749)	13,395	996,779		1,163,535	55	1,163,590
Transactions with owners:
Issuance of new shares				67	67												—		133		133
Acquisition of treasury shares					(5)	(27,051)											—		(27,057)		(27,057)
Disposal of treasury shares					0	0											—		1		1
Dividends			10					(138,217)									—		(138,217)		(138,217)
Transfers from other components of equity								23,906				(10,510)				(13,395)	(23,906)		—		—
Share-based compensation					29,335												—		29,335		29,335
Exercise of share-based awards					(42,725)	42,745											—		19		19
Total transactions with owners				67	(13,329)	15,694		(114,311)		—		(10,510)		—	—	(13,395)	(23,906)		(135,786)	—	(135,786)
As of September 30, 2022				1,676,330	1,695,544	(100,313)		1,530,200		2,022,333		16,819		(99,101)	(28,884)	—	1,911,167		6,712,929	560	6,713,489

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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Six-month period ended September 30, 2023 (From April 1 to September 30, 2023)

				(millions)
			Note	Equity attributable to owners of the Company															Non-<br>controlling<br>interests	Total<br>equity
	Share<br>capital			Sharepremium	Treasury<br>shares	Retained<br>earnings		Other components of equity										Total <br>equity attributable to owners of the Company
		Exchange<br>differences<br>on translation<br>of foreign<br>operations					Cash flow<br>hedges		Hedging<br>cost		Remeasurements of defined benefit pension plans		Total <br>other components of equity
As of April 1, 2023				1,676,345	1,728,830	(100,317)		1,541,146		1,606,128		12,470		(87,352)	(23,127)	—	1,508,119		6,354,122	549	6,354,672
Net profit for the period								41,365									—		41,365	71	41,436
Other comprehensive income (loss)										778,851		6,577		(2,015)	(2,579)	2,644	783,478		783,478	50	783,528
Comprehensive income (loss) for the period				—	—	—		41,365		778,851		6,577		(2,015)	(2,579)	2,644	783,478		824,843	121	824,964
Transactions with owners:
Issuance of new shares				158	158												—		315		315
Acquisition of treasury shares						(2,355)											—		(2,355)		(2,355)
Disposal of treasury shares					0	0											—		0		0
Dividends			10					(140,121)									—		(140,121)		(140,121)
Changes in ownership																	—		—	3	3
Transfers from other components of equity								3,628				(985)				(2,644)	(3,628)		—		—
Share-based compensation					33,606												—		33,606		33,606
Exercise of share-based awards					(51,485)	51,426											—		(60)		(60)
Total transactions with owners				158	(17,721)	49,071		(136,493)		—		(985)		—	—	(2,644)	(3,628)		(108,613)	3	(108,611)
As of September 30, 2023				1,676,503	1,711,109	(51,246)		1,446,018		2,384,979		18,062		(89,367)	(25,706)	—	2,287,969		7,070,352	673	7,071,024

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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(5) Condensed Interim Consolidated Statements of Cash Flows

		(millions)
		Six-month Period Ended September 30,
	Notes	2022
Cash flows from operating activities:
Net profit for the period		166,753
Depreciation and amortization		326,110
Impairment losses		35,950
Equity-settled share-based compensation		29,335
Loss on sales and disposal of property, plant and equipment		145
Gain on divestment of business and subsidiaries		(640)
Change in fair value of financial assets and liabilities associated with contingent consideration arrangements, net		446
Finance (income) and expenses, net		33,565
Share of loss (profit) of investments accounted for using the equity method		1,366
Income tax expenses (benefit)		53,269
Changes in assets and liabilities:
Increase in trade and other receivables		(5,915)
Increase in inventories		(15,778)
Decrease in trade and other payables		(137,260)
Increase (decrease) in provisions		(12,939)
Increase (decrease) in other financial liabilities		(48,068)
Other, net		(11,887)
Cash generated from operations		414,451
Income taxes paid		(115,432)
Tax refunds and interest on tax refunds received		6,215
Net cash from operating activities		305,234
Cash flows from investing activities:
Interest received		1,456
Dividends received		2,415
Acquisition of property, plant and equipment		(71,423)
Proceeds from sales of property, plant and equipment		97
Acquisition of intangible assets		(67,562)
Acquisition of investments		(4,694)
Proceeds from sales and redemption of investments		18,400
Proceeds from sales of business, net of cash and cash equivalents divested		—
Other, net		(609)
Net cash used in investing activities		(121,920)

All values are in Japanese Yen.

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		(millions)
		Six-month Period Ended September 30,
	Notes	2022
Cash flows from financing activities:
Net increase in short-term loans and commercial papers		—
Proceeds from issuance of bonds and long-term loans		—
Repayments of bonds and long-term loans		(26,900)
Proceeds from the settlement of cross currency interest rate swaps related to bonds		—
Acquisition of treasury shares		(26,929)
Interest paid		(52,719)
Dividends paid		(140,007)
Repayments of lease liabilities		(20,996)
Other, net		(42)
Net cash used in financing activities		(267,593)
Net decrease in cash and cash equivalents		(84,278)
Cash and cash equivalents at the beginning of the year		849,695
Effects of exchange rate changes on cash and cash equivalents		32,720
Cash and cash equivalents at the end of the period		798,137

All values are in Japanese Yen.

See accompanying notes to condensed interim consolidated financial statements.

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Notes to Condensed Interim Consolidated Financial Statements

1.    Reporting Entity

Takeda Pharmaceutical Company Limited (the “Company”) is a public company incorporated in Japan. The Company and its subsidiaries (collectively, “Takeda”) is a global, values-based, R&D-driven biopharmaceutical company with a diverse portfolio, engaged primarily in the research, development, production and global commercialization of pharmaceutical products. Takeda’s principal pharmaceutical products include medicines in the following key business areas: gastroenterology (“GI”), rare diseases, Plasma-Derived Therapies (“PDT”) immunology, oncology, and neuroscience.

2.    Basis of Preparation

(1) Compliance

Takeda has prepared the condensed interim consolidated financial statements in accordance with IAS 34 “Interim Financial Reporting” as issued by the International Accounting Standards Board (“IASB”).

The condensed interim consolidated financial statements do not contain all the information required in consolidated financial statements as of the end of a fiscal year. Therefore, the condensed interim consolidated financial statements should be used with the consolidated financial statements as of and for the fiscal year ended March 31, 2023.

(2) Approval of Financial Statements

Takeda’s condensed interim consolidated financial statements as of and for the six-month period ended September 30, 2023 were approved on October 30, 2023 by Representative Director, President & Chief Executive Officer (“CEO”) Christophe Weber and Director & Chief Financial Officer Costa Saroukos.

(3) Functional and Presentation Currency

The condensed interim consolidated financial statements are presented in Japanese yen (“JPY”), which is the functional currency of the Company. All financial information presented in JPY has been rounded to the nearest JPY million, except when otherwise indicated. In tables with rounded figures, sums may not add up due to rounding.

(4) Use of Judgments, Estimates and Assumptions

The preparation of the condensed interim consolidated financial statements requires management to make certain judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates.

These estimates and underlying assumptions are reviewed on a continuous basis. Changes in these accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

The condensed interim consolidated financial statements are prepared based on the same judgments and estimations as well as the accounting estimates and assumptions applied and described in Takeda’s consolidated financial statements as of and for the fiscal year ended March 31, 2023.

As of September 30, 2023 and through the issuance date of this report, Takeda concluded there was no indication of goodwill impairment.

3.    Material Accounting Policies

Material accounting policies adopted for the condensed interim consolidated financial statements are the same as those adopted for the consolidated financial statements as of and for the fiscal year ended March 31, 2023.

Takeda calculated income tax expenses for the six-month period ended September 30, 2023, based on the estimated average annual effective tax rate.

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4.    Operating Segment and Revenue Information

Takeda comprises a single operating segment and is engaged in the research, development, manufacturing, marketing and out-licensing of pharmaceutical products. This is consistent with how the financial information is viewed in allocating resources, measuring performance, and forecasting future periods by the CEO who is Takeda’s Chief Operating Decision Maker.

(1) Disaggregation of Revenue Information

Takeda’s revenue from contracts with customers is comprised of the following:

Revenue by Type of Good or Service

	(millions)
	Six-month Period Ended September 30,
	2022
Sales of pharmaceutical products	1,914,400
Out-licensing and service income	60,371
Total	1,974,771

All values are in Japanese Yen.

	(millions)
	Three-month period ended September 30,
	2022
Sales of pharmaceutical products	975,506
Out-licensing and service income	26,801
Total	1,002,307

All values are in Japanese Yen.

Revenue by Business Area and Product

	(millions)
	Six-month Period Ended September 30,
	2022
Gastroenterology:
ENTYVIO	346,616
GATTEX/REVESTIVE	48,434
TAKECAB/VOCINTI (1)	54,695
DEXILANT	37,990
PANTOLOC/CONTROLOC (2)	22,206
ALOFISEL	1,135
Others	35,314
Total Gastroenterology	546,391
Rare Diseases:
Rare Hematology:
ADVATE	62,368
ADYNOVATE/ADYNOVI	34,397
FEIBA	21,295
VONVENDI	5,899
RECOMBINATE	6,175
Others	25,584
Total Rare Hematology	155,718

All values are in Japanese Yen.

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	(millions)
	Six-month Period Ended September 30,
	2022
Rare Genetics and Other:
TAKHZYRO	72,827
ELAPRASE	42,414
REPLAGAL	34,308
VPRIV	23,339
LIVTENCITY	4,228
Others	29,392
Total Rare Genetics and Other	206,508
Total Rare Diseases	362,226
PDT Immunology:
immunoglobulin	245,055
albumin	51,765
Others	17,157
Total PDT Immunology	313,977
Oncology:
ADCETRIS	41,715
LEUPLIN/ENANTONE	53,657
NINLARO	48,819
ICLUSIG	23,216
ALUNBRIG	9,710
EXKIVITY	1,439
VELCADE	20,829
Others	25,906
Total Oncology	225,291
Neuroscience:
VYVANSE/ELVANSE	211,235
TRINTELLIX	49,798
Others	41,281
Total Neuroscience	302,314
Other:
AZILVA (1)	37,185
FOSRENOL	7,526
Others	179,860
Total Other	224,572
Total	1,974,771

All values are in Japanese Yen.

(1) The figures include the amounts of fixed dose combinations and blister packs.

(2) Generic name: pantoprazole

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	(millions)
	Three-month period ended September 30,
	2022
Gastroenterology:
ENTYVIO	178,349
GATTEX/REVESTIVE	26,518
TAKECAB/VOCINTI (1)	27,057
DEXILANT	15,660
PANTOLOC/CONTROLOC (2)	10,869
ALOFISEL	517
Others	17,038
Total Gastroenterology	276,009
Rare Diseases:
Rare Hematology:
ADVATE	30,262
ADYNOVATE/ADYNOVI	16,886
FEIBA	10,761
VONVENDI	2,978
RECOMBINATE	2,954
Others	12,746
Total Rare Hematology	76,587
Rare Genetics and Other:
TAKHZYRO	38,778
ELAPRASE	20,220
REPLAGAL	16,708
VPRIV	11,474
LIVTENCITY	2,014
Others	14,806
Total Rare Genetics and Other	103,999
Total Rare Diseases	180,586
PDT Immunology:
immunoglobulin	133,233
albumin	29,774
Others	9,108
Total PDT Immunology	172,115
Oncology:
ADCETRIS	21,751
LEUPLIN/ENANTONE	25,664
NINLARO	25,071
ICLUSIG	11,961
ALUNBRIG	5,167
EXKIVITY	737
VELCADE	4,348
Others	13,110
Total Oncology	107,809

All values are in Japanese Yen.

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	(millions)
	Three-month period ended September 30,
	2022
Neuroscience:
VYVANSE/ELVANSE	111,263
TRINTELLIX	28,364
Others	20,270
Total Neuroscience	159,897
Other:
AZILVA (1)	17,629
FOSRENOL	3,325
Others	84,937
Total Other	105,891
Total	1,002,307

All values are in Japanese Yen.

(1) The figures include the amounts of fixed dose combinations and blister packs.

(2) Generic name: pantoprazole

(2) Geographic Information

Takeda’s revenue from contracts with customers is based on the following geographic locations:

	(millions)
	Six-month Period Ended September 30,
	2022
Japan	261,353
U.S.	1,032,526
Europe and Canada	408,964
Asia (excluding Japan)	105,718
Latin America	83,258
Russia/CIS	37,817
Other	45,135
Total	1,974,771
“Other” includes the Middle East, Oceania and Africa. This disaggregation provides revenue attributable to countries or regions based on the customer location.

All values are in Japanese Yen.

	(millions)
	Three-month period ended September 30,
	2022
Japan	120,818
U.S.	531,468
Europe and Canada	203,391
Asia (excluding Japan)	59,622
Latin America	42,973
Russia/CIS	20,451
Other	23,583
Total	1,002,307
“Other” includes the Middle East, Oceania and Africa. This disaggregation provides revenue attributable to countries or regions based on the customer location.

All values are in Japanese Yen.

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5.    Amortization and impairment losses on intangible assets associated with products

The impairment losses recorded for the six-month period ended September 30, 2023 was JPY 115,750 million, which primarily include JPY 73,979 million impairment charges for ALOFISEL (for complex Crohn's perianal fistulas) following topline results of phase 3 ADMIRE-CD II trial and JPY 28,477 million impairment charges for EXKIVITY (for the treatment of non-small cell lung cancer) following a decision to initiate a voluntary withdrawal globally.

6.    Other Operating Expenses

Other operating expenses were JPY 83,359 million and JPY 110,240 million for the six-month period ended September 30, 2022 and 2023, respectively. Other operating expenses included restructuring expenses such as reductions in the workforce and consolidation of sites and functions. The amount of the restructuring expenses were JPY 24,584 million and JPY 38,500 million for the six-month period ended September 30, 2022 and 2023, respectively. Included expenses for reserves related to pre-launch inventories were JPY 17,975 million and JPY 11,747 million for the six-month period ended September 30, 2022 and 2023, respectively. Others include expenses for legal provision related to certain legal proceedings, donation and contributions and certain impairment losses.

7.    Income Tax Expenses

Shire received a tax assessment from the Irish Revenue Commissioners (“Irish Revenue”) on November 28, 2018 for EUR 398 million. This assessment relates to the tax treatment of the USD 1,635 million break fee Shire received from AbbVie, Inc. (“AbbVie”) in connection with the terminated offer to acquire Shire made by AbbVie in 2014. Shire was acquired by Takeda in January 2019. Takeda appealed the assessment to the Tax Appeals Commission (“TAC”) and the appeal was heard by the TAC in late 2020. On July 30, 2021, Takeda received a ruling on the matter from the TAC, with the TAC ruling in favor of the Irish Revenue and recorded an income taxes payable for the case. Subsequently, on October 17, 2023, Takeda agreed with the Irish Revenue to settle the tax assessment for EUR 130 million including interest and without penalties, as a full and final settlement of all liabilities in relation to the receipt of the break fee. As a result, Takeda reversed its income taxes payable in excess of the settlement amount of EUR 130 million and recorded JPY 63,547 million reduction to tax expenses.

The effective tax rate for the six-month period ended September 30, 2023 was (6.1)% compared to 24.2% for the six-month period ended September 30, 2022, mainly due to the tax expense reduction described above. This was partially offset by the tax charges from the write-down of deferred tax assets for the six-month period ended September 30, 2023.

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8.    Earnings per Share

The basis for calculating basic and diluted earnings per share (attributable to owners of the Company) is as follows:

	Six-month Period Ended September 30,
	2022	2023
Net profit for the period attributable to owners of the Company
Net profit for the period attributable to owners of the Company (million JPY)	166,756	41,365
Net profit used for calculation of earnings per share (million JPY)	166,756	41,365
Weighted average number of ordinary shares outstanding during the period (thousands of shares) [basic]	1,549,479	1,560,613
Dilutive effect (thousands of shares)	10,723	12,706
Weighted average number of ordinary shares outstanding during the period (thousands of shares) [diluted]	1,560,202	1,573,319
Earnings per share
Basic earnings per share (JPY)	107.62	26.51
Diluted earnings per share (JPY)	106.88	26.29
	Three-month Period Ended September 30,
	2022	2023
Net profit for the period attributable to owners of the Company
Net profit (loss) for the period attributable to owners of the Company (million JPY)	61,742	(48,030)
Net profit (loss) used for calculation of earnings per share (million JPY)	61,742	(48,030)
Weighted average number of ordinary shares outstanding during the period (thousands of shares) [basic]	1,552,407	1,565,296
Dilutive effect (thousands of shares)	11,326	—
Weighted average number of ordinary shares outstanding during the period (thousands of shares) [diluted]	1,563,733	1,565,296
Earnings per share
Basic earnings (loss) per share (JPY)	39.77	(30.68)
Diluted earnings (loss) per share (JPY)	39.48	(30.68)

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9.    Bonds and Loans

(1) Bonds

During the six-month period ended September 30, 2023, Takeda redeemed the following bonds.

Instrument	Issuance	Redemption date	Principal Amount in contractual currency	Type of redemption
USD Unsecured Senior Notes	September 2016	September 23, 2023	USD1,000 million	Maturity redemption

(2) Loans

During the six-month period ended September 30, 2023, Takeda entered into the following borrowing.

Instrument	Execution	Maturity	Principal Amount in contractual currency
Syndicated loans	April 2023	April 2030	JPY 100,000 million

During the six-month period ended September 30, 2023, Takeda repaid the following borrowing.

Instrument	Execution	Repayment date	Principal Amount in contractual currency	Type of repayment
Syndicated loans	April 2016	April 26, 2023	JPY 100,000 million	Maturity repayment

10.    Equity and Other Equity Items

(1) Disposal of treasury shares

During the six-month period ended September 30, 2022, the Company conducted the disposal of 8,091 thousand treasury shares under the Long Term Incentive Plan (“LTIP”) for the Company Group employees overseas. The disposal of treasury shares resulted in a decrease in treasury shares of JPY 27,599 million.

During the six-month period ended September 30, 2023, the Company conducted the disposal of 13,958 thousand treasury shares under the LTIP for the Company Group employees overseas. The disposal of treasury shares resulted in a decrease in treasury shares of JPY 47,614 million.

The Company's treasury shares were converted into the Company’s American Depositary Shares and settled with employees.

(2) Dividends

Dividends declared and paid	Total dividends declared and paid JPY (millions)	Dividends<br>per share<br>(JPY)	Record date	Effective date
April 1, 2022 to September 30, 2022
Q1 2022	140,365	90.00	March 31, 2022	June 30, 2022
April 1, 2023 to September 30, 2023
Q1 2023	140,475	90.00	March 31, 2023	June 29, 2023

Dividends declared for which the effective date falls in after September 30, 2023 are as follows:

Dividends declared	Total dividends declared<br>JPY (millions)	Dividends per share (JPY)	Record date	Effective date
Q3 2023	148,037	94.00	September 30, 2023	December 1, 2023

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11.    Financial Instruments

(1) Fair Value Measurements

Derivative and non-derivative financial instruments measured at fair value are categorized in the following three-tier fair value hierarchy that reflects the significance of the inputs in making the measurements. Level 1 is defined as observable inputs, such as quoted prices in active markets for an identical asset or liability. Level 2 is defined as inputs other than quoted prices in active markets within Level 1 that are directly or indirectly observable. Level 3 is defined as unobservable inputs.

	(millions)
As of September 30, 2023	Level 1	Level 3	Total
Assets:
Financial assets measured at fair value through profit or loss
Derivatives	—	7,321	15,659
Investments in convertible notes	—	10,785	10,785
Investments in debt instruments	—	1,113	1,113
Financial assets associated with contingent consideration arrangements	—	25,039	25,039
Derivatives for which hedge accounting is applied	—	—	64,683
Financial assets measured at fair value through OCI
Trade and other receivables	—	—	84,152
Equity instruments	91,317	95,969	187,286
Total	91,317	140,227	388,717
Liabilities:
Financial liabilities measured at fair value through profit or loss
Derivatives	—	7,321	14,030
Financial liabilities associated with contingent consideration arrangements	—	8,481	8,481
Derivatives for which hedge accounting is applied	—	—	39,939
Total	—	15,802	62,450

All values are in Japanese Yen.

(2) Valuation Techniques

The fair value of derivatives classified as Level 2 is measured based on Treasury management system valuation models or the Black-Scholes model, whose significant inputs are based on observable market data.

Derivatives classified as Level 3 include those recognized in connection with settlements of cash flows arising from differences between the fixed prices and floating market prices of renewable energy in a virtual power purchase agreement and those recognized in an agreement to offset the volatility of such cash flows. The fair value of derivatives in Level 3 is measured using the discounted cash flow method. The key assumptions taken into account include forecasted renewable energy prices and the expected generation of the renewable energy generating facility.

The fair value of the investment in convertible notes is measured using techniques such as the discounted cash flow and option pricing models.

The fair value of trade and other receivables, which are due from customers that Takeda has the option to factor, are measured based on the invoiced amount.

Equity investments and investments in debt instruments are not held for trading. If equity instruments or investments in debt instruments are quoted in an active market, the fair value is based on price quotations at the period-end-date. If equity instruments or investments in debt instruments are not quoted in an active market, the fair value is calculated utilizing an adjusted book value per share method or EBITDA multiples approach based on available information as of each period-end-date and comparable companies. The principal input that is not observable and utilized for the calculation of the fair value of equity instruments and investments in debt instruments classified as Level 3 is the EBITDA rate used for the EBITDA multiples approach, which ranges from 5.0 times to 20.1 times.

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Financial assets and liabilities associated with contingent consideration arrangements are measured at fair value at the time of the divestiture or the acquisition date of business combination. When the contingent consideration arrangement meets the definition of a financial asset or liability, it is subsequently re-measured at fair value at each closing date. The determination of the fair value is based on models such as scenario-based methods and discounted cash flows. The key assumptions take into consideration the probability of meeting each performance target, forecasted revenue projections, and the discount factor. The financial assets associated with contingent consideration arrangements are recognized mainly in relation to the divestiture of XIIDRA. The financial liabilities associated with contingent consideration arrangements are discussed in Note (5) Financial liabilities associated with contingent consideration arrangements.

(3) Transfers between levels

Takeda recognizes transfers between levels of the fair value hierarchy, at the end of the reporting period during which the change has occurred. There were transfers from Level 3 to Level 1 recorded in the six-month period ended September 30, 2023. These transfers resulted from the investments in the companies whose shares were previously not listed on an equity or stock exchange and had no recent observable active trades in the shares. During the six-month period ended September 30, 2023, the companies listed their equity shares on an exchange and are currently actively traded in the market. As the equity shares have a published price quotation in an active market, the fair value measurement was transferred from Level 3 to Level 1 on the fair value hierarchy during the six-month period ended September 30, 2023. There were no other significant transfers between levels of the fair value hierarchy during the six-month period ended September 30, 2023.

(4) Level 3 fair values

Takeda invests in equity instruments mainly for research collaboration. The following table shows a reconciliation from the opening balances to the closing balances for Level 3 financial asset fair values for the six-month period ended September 30, 2023. The disclosure related to Level 3 financial liabilities which are financial liabilities associated with contingent consideration arrangements are included in (5) Financial liabilities associated with contingent consideration arrangements. There are no significant changes in fair value during the changes in certain assumptions which influence the fair value measurement for Level 3 financial assets.

	(millions)
	Six-month Period Ended September 30, 2023
	Financial assets associated with contingent consideration arrangements
As of the beginning of the period	23,806
Changes recognized as finance income or finance expenses	(1,360)
Changes in fair value of financial assets measured at fair value through OCI and exchange differences on translation of foreign operations	2,594
Purchases	—
Sales	—
Transfers to Level 1	—
Acquisition from conversion of convertible notes	—
As of the end of the period	25,039

All values are in Japanese Yen.

(5) Financial liabilities associated with contingent consideration arrangements

Financial liabilities associated with contingent consideration arrangements represent consideration related to business combinations or license agreements that are payable only upon future events such as the achievement of development milestones and sales targets, including pre-existing contingent consideration arrangements of the companies that are acquired by Takeda. At each reporting date, the fair value of financial liabilities associated with contingent consideration arrangements is re-measured based on risk-adjusted future cash flows discounted using an appropriate discount rate.

As of September 30, 2023, the balance primarily relates to pre-existing contingent consideration arrangements from historical acquisitions.

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The fair value of financial liabilities associated with contingent consideration arrangements could increase or decrease due to changes in certain assumptions which underpin the fair value measurements. The assumptions include probability of milestones being achieved.

The fair value of financial liabilities associated with contingent consideration arrangements are classified as Level 3 in the fair value hierarchy. The following table shows a reconciliation from the opening balances to the closing balances for financial liabilities associated with contingent consideration arrangements for the six-month period ended September 30, 2023. There are no significant changes in fair value during the changes in significant assumptions which influence the fair value measurement for financial liabilities associated with contingent consideration arrangements.

	JPY (millions)
	Six-month Period Ended September 30, 2023
As of the beginning of the period	8,139
Changes in the fair value during the period	(121)
Foreign currency translation differences	463
As of the end of the period	8,481

(6) Financial instruments not measured at fair value

The carrying amount and fair value of financial instruments that are not measured at fair value in the condensed interim consolidated statements of financial position are as follows. Fair value information is not provided for financial instruments, if the carrying amount is a reasonable estimate of fair value due to the relatively short period of maturity of these instruments.

	(millions)
	As of September 30, 2023
	Carryingamount
Bonds	3,781,851
Long-term loans	747,026

All values are in Japanese Yen.

Long-term financial liabilities are recognized at their carrying amount. The fair value of bonds is measured at quotes whose significant inputs to the valuation model used are based on observable market data. The fair value of loans is measured at the present value of future cash flows discounted using the applicable market rate on the loans in consideration of the credit risk by each group classified in a specified period. The fair value of bonds and long-term loans are classified as Level 2 in the fair value hierarchy.

12.    Subsequent Events

Not applicable.

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2. Others

Interim Dividend

In accordance with the provision of Article 29 of the Articles of Incorporation of the Company, Takeda made the following resolution on an interim dividend for the 147th fiscal year (from April 1, 2023 to March 31, 2024) at the meeting of the Board of Directors held on October 26, 2023.

(a)	Total amount of interim dividends	JPY 148,037,012,490
(b)	Interim dividend per share	JPY 94.00
(c)	Effective date/ Payment start date	December 1, 2023

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B. Information on Guarantors of the Company

Not applicable.

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Document

Exhibit 99.1

FINANCIAL APPENDIX
Definition of Non-IFRS Measures
---	---	---
	Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations	A-1
	Definition of EBITDA/Adjusted EBITDA and Net Debt	A-2
Reconciliations and Other Financial Information
	FY2023 H1 Reported Results with CER % Change	A-3
	FY2023 Q2 (Jul-Sep) Reported Results with CER % Change	A-4
	FY2023 H1 Core Results with CER % Change	A-5
	FY2023 Q2 (Jul-Sep) Core Results with CER % Change	A-6
	FY2023 H1 Reconciliation from Reported to Core	A-7
	FY2023 Q2 (Jul-Sep) Reconciliation from Reported to Core	A-8
	FY2022 H1 Reconciliation from Reported to Core	A-9
	FY2022 Q2 (Jul-Sep) Reconciliation from Reported to Core	A-10
	FY2023 H1 Free Cash Flow	A-11
	FY2023 H1 Net Debt to Adjusted EBITDA	A-12
	FY2022 Net Debt to Adjusted EBITDA	A-13
	FY2023 H1 Net Profit to Adjusted EBITDA Bridge	A-14
	FY2023 H1 Net Profit to Adjusted EBITDA LTM Bridge	A-15
	FY2023 H1 CAPEX, Depreciation and Amortization and Impairment Losses	A-16
	FY2023 Full Year Detailed Forecast	A-17
	FY2023 Full Year Reconciliation from Reported Operating Profit to Core Operating Profit Forecast	A-18
	FY2023 Full Year FX Rates Assumptions and Currency Sensitivity	A-19
Important Notice
	Important Notice, Forward-Looking Statements	A-20

Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations

Core Revenue represents revenue adjusted to exclude significant items unrelated to Takeda’s core operations.

Core Operating Profit represents net profit adjusted to exclude income tax expenses, the share of profit or loss of investments accounted for using the equity method, finance expenses and income, other operating expenses and income, amortization and impairment losses on acquired intangible assets and other items unrelated to Takeda’s core operations, such as non-recurring items, purchase accounting effects and transaction related costs.

Core EPS represents net profit adjusted to exclude the impact of items excluded in the calculation of Core Operating Profit, and other non-operating items (e.g. amongst other items, fair value adjustments and the imputed financial charge related to contingent consideration) that are unusual, non-recurring in nature or unrelated to Takeda’s ongoing operations and the tax effect of each of the adjustments, divided by the average outstanding shares (excluding treasury shares) of the reporting periods presented.

Constant Exchange Rate (CER) change eliminates the effect of foreign exchange rates from year-over-year comparisons by translating Reported or Core results for the current period using corresponding exchange rates in the same period of the previous fiscal year.

We present Free Cash Flow because we believe that this measure is useful to investors as similar measures of liquidity are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. Free Cash Flow is also used by our management to evaluate our liquidity and our cash flows, particularly as they relate to our ability to meet our liquidity requirements and to support our capital allocation policies. We also believe that Free Cash Flow is helpful to investors in understanding how our strategic divestitures of non-core businesses and of portions of our investment portfolio contribute to the cash flows and liquidity available to us.

We define Free Cash Flow as cash flows from operating activities, subtracting acquisition of property, plant and equipment (“PP&E”), intangible assets and investments as well as removing any other cash that is not available to Takeda’s immediate or general business use, and adding proceeds from sales of PP&E, as well as from sales of investments and businesses, net of cash and cash equivalents divested.

The usefulness of Free Cash Flow to investors has significant limitations including, but not limited to, (i) it may not be comparable to similarly titled measures used by other companies, including those in our industry, (ii) it does not reflect the effect of our current and future contractual and other commitments requiring the use or allocation of capital and (iii) the addition of proceeds from sales and redemption of investments and the proceeds from sales of business, net of cash and cash equivalents divested do not reflect cash received from our core ongoing operations. Free Cash Flow should not be considered in isolation and is not, and should not be viewed as, a substitute for cash flows from operating activities or any other measure of liquidity presented in accordance with IFRS. The most directly comparable measure under IFRS for Free Cash Flow is net cash from operating activities.

U.S. Dollar Convenience Translations

In Financial Appendix, certain amounts presented in Japanese yen have been translated to U.S. dollars solely for the convenience of the reader at an exchange rate of 1USD = 149.43 JPY, the Noon Buying Rate certified by the Federal Reserve Bank of New York on September 29, 2023. The rate and methodologies used for the convenience translations differ from the currency exchange rates and translation methodologies under IFRS used for the preparation of the condensed interim consolidated financial statements. The translation should not be construed as a representation that the Japanese yen amounts could be converted into U.S. dollars at this or any other rate.

A-1

Definition of EBITDA/Adjusted EBITDA and Net Debt

We present EBITDA and Adjusted EBITDA because we believe that these measures are useful to investors as they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We further believe that Adjusted EBITDA is helpful to investors in identifying trends in its business that could otherwise be obscured by certain items unrelated to ongoing operations because they are highly variable, difficult to predict, may substantially impact our results of operations and may limit the ability to evaluate our performance from one period to another on a consistent basis.

EBITDA and Adjusted EBITDA should not be considered in isolation or construed as alternatives to operating income, net profit for the year or any other measure of performance presented in accordance with IFRS. These non-IFRS measures may not be comparable to similarly-titled measures presented by other companies.

The usefulness of EBITDA and Adjusted EBITDA to investors has limitations including, but not limited to, (i) they may not be comparable to similarly titled measures used by other companies, including those in our industry, (ii) they exclude financial information and events, such as the effects of an acquisition or amortization of intangible assets, that some may consider important in evaluating our performance, value or prospects for the future, (iii) they exclude items or types of items that may continue to occur from period to period in the future and (iv) they may not exclude all items which investors may consider to be unrelated to our long-term operations. These non-IFRS measures are not, and should not be viewed as, substitutes for IFRS reported net income (loss). We encourage investors to review our historical financial statements in their entirety and caution investors to use IFRS measures as the primary means of evaluating our performance, value and prospects for the future, and EBITDA and Adjusted EBITDA as supplemental measures.

We define EBITDA as consolidated net profit before income tax expenses, depreciation and amortization and net interest expense. We define Adjusted EBITDA as EBITDA further adjusted to exclude impairment losses, other operating income and expenses (excluding depreciation and amortization), finance income and expenses (excluding net interest expense), our share of loss from investments accounted for under the equity method and other items that management believes are unrelated to our core operations such as purchase accounting effects and transaction related costs.

The most closely comparable measure presented in accordance with IFRS is net profit for the period. Please refer to Net Profit to Adjusted EBITDA Bridge for a reconciliation to the respective most closely comparable measures presented in accordance with IFRS.

We present Net Debt because we believe that it is useful to investors in that our management uses it to monitor and evaluate our indebtedness, net of cash and cash equivalents, and, in conjunction with Adjusted EBITDA, to monitor our leverage. We also believe that similar measures of indebtedness are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

We define Net Debt first by calculating the sum of the current and non-current portions of bonds and loans as shown on our consolidated statement of financial position, which is then adjusted to reflect (i) the use of prior 12-month average exchange rates for non-JPY debt outstanding at the beginning of the period and the use of relevant spot rates for new non-JPY debt incurred and existing non-JPY debt redeemed during the reporting period, which reflects the methodology our management uses to monitor our leverage, and (ii) a 50% equity credit applied to our aggregate principal amount of 500.0 billion hybrid (subordinated) bonds issued in June 2019 by S&P Global Rating Japan in recognition of the equity-like features of those bonds pursuant to such agency’s ratings methodology. To calculate Net Debt, we deduct from this figure cash & cash equivalents, excluding cash temporarily held by Takeda on behalf of third parties related to vaccine operations and to the trade receivables sales program, and debt investments classified as Level 1 in the fair value hierarchy being recorded as Other Financial Assets.

The usefulness of Net Debt to investors has significant limitations including, but not limited to, (i) it may not be comparable to similarly titled measures used by other companies, including those in our industry, (ii) it does not reflect the amounts of interest payments to be paid on our indebtedness, (iii) it does not reflect any restrictions on our ability to prepay or redeem any of our indebtedness, (iv) it does not reflect any fees, costs or other expenses that we may incur in converting cash equivalents to cash, in converting cash from one currency into another or in moving cash within our consolidated group, (v) it applies to gross debt an adjustment for average foreign exchange rates which, although consistent with our financing agreements, does not reflect the actual rates at which we would be able to convert one currency into another and (vi) it reflects an equity credit due to the fact that the amounts of our subordinated bonds, although we believe it to be reasonable, do not affect the status of those instruments as indebtedness. Net Debt should not be considered in isolation and are not, and should not be viewed as, a substitute for bonds and loans or any other measure of indebtedness presented in accordance with IFRS.

The most directly comparable measures under IFRS for Net Debt is bonds and loans. Please refer to Net Debt to Adjusted EBITDA for a reconciliation to this measure.

A-2

FY2023 H1 Reported Results with CER % Change
(Billion , except EPS)	FY2022 H1		FY2023 H1		vs. PY			(Million ,except EPS)FY2023 H1Convenience Translation
---	---	---	---	---	---	---	---	---
						CER
		% CHANGE				% CHANGE
Revenue	1,974.8		2,101.7		126.9	6.4%	1.4%	14,065
Cost of sales	(598.3)		(664.7)		(66.4)	(11.1)%	(6.0)%	(4,448)
Gross profit	1,376.4		1,437.0		60.6	4.4%	(0.5)%	9,617
Margin	69.7	%	68.4	%		(1.3) pp	(1.4) pp	68.4
SG&A expenses	(480.2)		(501.1)		(20.9)	(4.3)%	0.8%	(3,353)
R&D expenses	(297.8)		(346.7)		(48.9)	(16.4)%	(9.6)%	(2,320)
Amortization of intangible assets associated with products	(240.8)		(253.9)		(13.1)	(5.4)%	1.5%	(1,699)
Impairment losses on intangible assets associated with products	(32.8)		(115.8)		(82.9)	(252.5)%	(226.2)%	(775)
Other operating income	13.5		9.9		(3.6)	(26.7)%	(27.6)%	66
Other operating expenses	(83.4)		(110.2)		(26.9)	(32.2)%	(27.1)%	(738)
Operating profit	255.0		119.2		(135.7)	(53.2)%	(50.6)%	798
Margin	12.9	%	5.7	%		(7.2) pp	(6.6) pp	5.7
Finance income	75.7		24.3		(51.4)	(67.9)%	(68.3)%	163
Finance expenses	(109.3)		(106.1)		3.2	2.9%	1.9%	(710)
Share of profit (loss) of investments accounted for using the equity method	(1.4)		1.6		3.0	―	―	11
Profit before tax	220.0		39.1		(181.0)	(82.3)%	(79.8)%	261
Income tax (expenses) benefit	(53.3)		2.4		55.7	―	86.0%	16
Net profit for the period	166.8		41.4		(125.3)	(75.2)%	(77.8)%	277
Non-controlling interests	0.0		(0.1)		(0.1)	―	―	(0)
Net profit attributable to owners of the Company	166.8		41.4		(125.4)	(75.2)%	(77.8)%	277
Basic EPS ( or )	107.62		26.51		(81.12)	(75.4)%	(78.0)%	0.18
When comparing results to the same period of the previous fiscal year, the amount of change and percentage change based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentage change based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to A-1 Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations, for the definition of the “Constant Exchange Rate change”.
% change versus prior year is presented as positive when favorable to profits, and negative when unfavorable to profits.

All values are in Japanese Yen.

A-3

FY2023 Q2 (Jul-Sep) Reported Results with CER % Change
(Billion , except EPS)	FY2022 Q2<br><br>(Jul-Sep)		FY2023 Q2<br><br>(Jul-Sep)		vs. PY			(Million ,except EPS)FY2023 Q2 (Jul-Sep)Convenience Translation
---	---	---	---	---	---	---	---	---
						CER
		% CHANGE				% CHANGE
Revenue	1,002.3		1,043.1		40.8	4.1%	(0.8)%	6,980
Cost of sales	(305.4)		(343.6)		(38.1)	(12.5)%	(7.3)%	(2,299)
Gross profit	696.9		699.5		2.6	0.4%	(4.3)%	4,681
Margin	69.5	%	67.1	%		(2.5) pp	(2.5) pp	67.1
SG&A expenses	(248.7)		(253.0)		(4.2)	(1.7)%	3.4%	(1,693)
R&D expenses	(154.1)		(183.9)		(29.8)	(19.3)%	(12.4)%	(1,231)
Amortization of intangible assets associated with products	(123.8)		(130.7)		(6.9)	(5.6)%	1.1%	(875)
Impairment losses on intangible assets associated with products	(18.6)		(109.5)		(90.9)	(489.0)%	(444.0)%	(733)
Other operating income	8.0		5.7		(2.3)	(29.1)%	(31.4)%	38
Other operating expenses	(55.2)		(77.4)		(22.2)	(40.2)%	(35.9)%	(518)
Operating profit	104.4		(49.3)		(153.8)	―	―	(330)
Margin	10.4	%	(4.7)	%		(15.2) pp	(14.4) pp	(4.7)
Finance income	14.8		9.4		(5.4)	(36.7)%	(25.7)%	63
Finance expenses	(53.8)		(58.1)		(4.2)	(7.8)%	(16.1)%	(389)
Share of profit (loss) of investments accounted for using the equity method	(0.9)		2.0		2.9	―	―	14
Profit before tax	64.5		(96.0)		(160.5)	―	―	(642)
Income tax (expenses) benefit	(2.8)		48.0		50.8	―	―	321
Net profit for the period	61.7		(48.0)		(109.7)	―	―	(321)
Non-controlling interests	0.0		(0.1)		(0.1)	―	―	(0)
Net profit attributable to owners of the Company	61.7		(48.0)		(109.8)	―	―	(321)
Basic EPS ( or )	39.77		(30.68)		(70.46)	―	―	(0.21)
When comparing results to the same period of the previous fiscal year, the amount of change and percentage change based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentage change based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to A-1 Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations, for the definition of the “Constant Exchange Rate change”.
% change versus prior year is presented as positive when favorable to profits, and negative when unfavorable to profits.

All values are in Japanese Yen.

A-4

FY2023 H1 Core Results with CER % Change
(Billion , except EPS)	FY2022 H1		FY2023 H1		vs. PY			(Million ,except EPS)FY2023 H1Convenience Translation
---	---	---	---	---	---	---	---	---
						CER
		% CHANGE				% CHANGE
Revenue	1,974.8		2,101.7		126.9	6.4%	1.4%	14,065
Cost of sales	(571.6)		(664.8)		(93.3)	(16.3)%	(10.9)%	(4,449)
Gross profit	1,403.2		1,436.9		33.7	2.4%	(2.4)%	9,616
Margin	71.1	%	68.4	%		(2.7) pp	(2.7) pp	68.4
SG&A expenses	(480.5)		(501.4)		(20.9)	(4.3)%	0.8%	(3,356)
R&D expenses	(297.5)		(346.7)		(49.2)	(16.5)%	(9.7)%	(2,320)
Operating profit	625.2		588.8		(36.4)	(5.8)%	(9.5)%	3,940
Margin	31.7	%	28.0	%		(3.6) pp	(3.4) pp	28.0
Finance income	32.6		24.0		(8.6)	(26.4)%	(27.2)%	161
Finance expenses	(100.8)		(87.8)		13.0	12.9%	18.9%	(588)
Share of profit (loss) of investments accounted for using the equity method	2.7		2.3		(0.4)	(14.4)%	(13.7)%	15
Profit before tax	559.6		527.2		(32.4)	(5.8)%	(8.8)%	3,528
Income tax (expenses) benefit	(112.9)		(119.4)		(6.6)	(5.8)%	(11.0)%	(799)
Net profit for the period	446.7		407.8		(38.9)	(8.7)%	(13.8)%	2,729
Non-controlling interests	0.0		(0.1)		(0.1)	―	―	(0)
Net profit attributable to owners of the Company	446.7		407.7		(39.0)	(8.7)%	(13.8)%	2,728
Basic EPS ( or )	288		261		(27)	(9.4)%	(14.4)%	1.75
When comparing results to the same period of the previous fiscal year, the amount of change and percentage change based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentage change based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to A-1 Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations, for the definition of the “Constant Exchange Rate change”.
% change versus prior year is presented as positive when favorable to profits, and negative when unfavorable to profits.

All values are in Japanese Yen.

A-5

FY2023 Q2 (Jul-Sep) Core Results with CER % Change
(Billion , except EPS)	FY2022 Q2<br><br>(Jul-Sep)		FY2023 Q2<br><br>(Jul-Sep)		vs. PY			(Million ,except EPS)FY2023 Q2 (Jul-Sep)Convenience Translation
---	---	---	---	---	---	---	---	---
						CER
		% CHANGE				% CHANGE
Revenue	1,002.3		1,043.1		40.8	4.1%	(0.8)%	6,980
Cost of sales	(293.3)		(343.6)		(50.3)	(17.1)%	(11.7)%	(2,299)
Gross profit	709.0		699.5		(9.5)	(1.3)%	(5.9)%	4,681
Margin	70.7	%	67.1	%		(3.7) pp	(3.7) pp	67.1
SG&A expenses	(248.8)		(253.1)		(4.3)	(1.7)%	3.3%	(1,694)
R&D expenses	(154.0)		(183.9)		(29.9)	(19.4)%	(12.6)%	(1,231)
Operating profit	306.1		262.4		(43.7)	(14.3)%	(17.3)%	1,756
Margin	30.5	%	25.2	%		(5.4) pp	(5.1) pp	25.2
Finance income	8.9		9.2		0.3	3.2%	21.6%	61
Finance expenses	(50.0)		(44.5)		5.6	11.1%	12.7%	(298)
Share of profit (loss) of investments accounted for using the equity method	1.7		1.5		(0.2)	(11.6)%	(11.1)%	10
Profit before tax	266.7		228.7		(38.0)	(14.3)%	(16.8)%	1,530
Income tax (expenses) benefit	(44.2)		(54.3)		(10.1)	(22.9)%	(42.9)%	(363)
Net profit for the period	222.5		174.4		(48.2)	(21.6)%	(28.6)%	1,167
Non-controlling interests	0.0		(0.1)		(0.1)	―	―	(0)
Net profit attributable to owners of the Company	222.5		174.3		(48.2)	(21.7)%	(28.6)%	1,167
Basic EPS ( or )	143		111		(32)	(22.3)%	(29.2)%	0.75
When comparing results to the same period of the previous fiscal year, the amount of change and percentage change based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentage change based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to A-1 Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations, for the definition of the “Constant Exchange Rate change”.
% change versus prior year is presented as positive when favorable to profits, and negative when unfavorable to profits.

All values are in Japanese Yen.

A-6

FY2023 H1 Reconciliation from Reported to Core
(Billion , except EPS and number of shares)	REPORTED		REPORTED TO CORE ADJUSTMENTS						CORE
---	---	---	---	---	---	---	---	---	---
		Impairment of<br>intangible<br>assets		Other<br>operating income/<br>expenses		Others
Revenue	2,101.7								2,101.7
Cost of sales	(664.7)							(0.1)	(664.8)
Gross profit	1,437.0							(0.1)	1,436.9
SG&A expenses	(501.1)							(0.3)	(501.4)
R&D expenses	(346.7)							0.0	(346.7)
Amortization of intangible assets associated with products	(253.9)		253.9						—
Impairment losses on intangible assets associated with products	(115.8)				115.8				—
Other operating income	9.9						(9.9)		—
Other operating expenses	(110.2)						110.2		—
Operating profit	119.2		253.9		115.8		100.4	(0.5)	588.8
Margin	5.7	%							28.0%
Finance income and (expenses), net	(81.8)							18.0	(63.8)
Share of profit (loss) of investments accounted for using the equity method	1.6							0.7	2.3
Profit before tax	39.1		253.9		115.8		100.4	18.1	527.2
Income tax (expenses) benefit	2.4		(54.1)		(25.6)		(16.5)	(25.6)	(119.4)
Non-controlling interests	(0.1)								(0.1)
Net profit attributable to owners of the Company	41.4		199.8		90.1		83.8	(7.5)	407.7
EPS ()	27								261
Number of shares (millions)	1,561								1,561

All values are in Japanese Yen.

A-7

FY2023 Q2 (Jul-Sep) Reconciliation from Reported to Core
(Billion , except EPS and number of shares)	REPORTED		REPORTED TO CORE ADJUSTMENTS						CORE
---	---	---	---	---	---	---	---	---	---
		Impairment of<br>intangible<br>assets		Other<br>operating income/<br>expenses		Others
Revenue	1,043.1								1,043.1
Cost of sales	(343.6)							(0.0)	(343.6)
Gross profit	699.5							(0.0)	699.5
SG&A expenses	(253.0)							(0.2)	(253.1)
R&D expenses	(183.9)							0.0	(183.9)
Amortization of intangible assets associated with products	(130.7)		130.7						—
Impairment losses on intangible assets associated with products	(109.5)				109.5				—
Other operating income	5.6						(5.6)		—
Other operating expenses	(77.3)						77.3		—
Operating profit	(49.3)		130.7		109.5		71.7	(0.2)	262.4
Margin	(4.7)	%							25.2%
Finance income and (expenses), net	(48.7)							13.4	(35.3)
Share of profit (loss) of investments accounted for using the equity method	2.0							(0.5)	1.5
Profit before tax	(96.0)		130.7		109.5		71.7	12.7	228.7
Income tax (expenses) benefit	48.0		(27.8)		(24.3)		(10.1)	(40.1)	(54.3)
Non-controlling interests	(0.1)								(0.1)
Net profit attributable to owners of the Company	(48.0)		102.9		85.3		61.6	(27.4)	174.3
EPS ()	(31)								111
Number of shares (millions)	1,565								1,565

All values are in Japanese Yen.

A-8

FY2022 H1 Reconciliation from Reported to Core
(Billion , except EPS and number of shares)	REPORTED		REPORTED TO CORE ADJUSTMENTS				CORE
---	---	---	---	---	---	---	---
		Impairment of<br>intangible<br>assets		Other<br>operating income/<br>expenses				Others
Revenue	1,974.8									1,974.8
Cost of sales	(598.3)								26.8	(571.6)
Gross profit	1,376.4								26.8	1,403.2
SG&A expenses	(480.2)								(0.3)	(480.5)
R&D expenses	(297.8)								0.3	(297.5)
Amortization of intangible assets associated with products	(240.8)		240.8							—
Impairment losses on intangible assets associated with products	(32.8)				32.8					—
Other operating income	13.5					(13.5)				—
Other operating expenses	(83.4)					83.4				—
Operating profit	255.0		240.8		32.8	69.9			26.7	625.2
Margin	12.9	%								31.7%
Finance income and (expenses), net	(33.6)								(34.7)	(68.3)
Share of profit (loss) of investments accounted for using the equity method	(1.4)								4.0	2.7
Profit before tax	220.0		240.8		32.8	69.9			(4.0)	559.6
Income tax (expenses) benefit	(53.3)		(51.5)		(7.0)	(13.1)			12.0	(112.9)
Non-controlling interests	0.0									0.0
Net profit attributable to owners of the Company	166.8		189.3		25.8	56.8			8.0	446.7
EPS ()	108									288
Number of shares (millions)	1,549									1,549

All values are in Japanese Yen.

A-9

FY2022 Q2 (Jul-Sep) Reconciliation from Reported to Core
(Billion , except EPS and number of shares)	REPORTED		REPORTED TO CORE ADJUSTMENTS				CORE
---	---	---	---	---	---	---	---
		Impairment of<br>intangible<br>assets		Other<br>operating income/<br>expenses				Others
Revenue	1,002.3									1,002.3
Cost of sales	(305.4)								12.1	(293.3)
Gross profit	696.9								12.1	709.0
SG&A expenses	(248.7)								(0.1)	(248.8)
R&D expenses	(154.1)								0.2	(154.0)
Amortization of intangible assets associated with products	(123.8)		123.8							—
Impairment losses on intangible assets associated with products	(18.6)				18.6					—
Other operating income	8.0					(8.0)				—
Other operating expenses	(55.2)					55.2				—
Operating profit	104.4		123.8		18.6	47.2			12.1	306.1
Margin	10.4	%								30.5%
Finance income and (expenses), net	(39.0)								(2.1)	(41.1)
Share of profit (loss) of investments accounted for using the equity method	(0.9)								2.6	1.7
Profit before tax	64.5		123.8		18.6	47.2			12.6	266.7
Income tax (expenses) benefit	(2.8)		(26.5)		(3.9)	(9.1)			(1.9)	(44.2)
Non-controlling interests	0.0									0.0
Net profit attributable to owners of the Company	61.7		97.3		14.7	38.0			10.7	222.5
EPS ()	40									143
Number of shares (millions)	1,552									1,552

All values are in Japanese Yen.

A-10

FY2023 H1 Free Cash Flow
(Billion JPY)	FY2022 H1	FY2023 H1	vs. PY			(Million USD)<br>FY2023 H1<br>Convenience USD Translation
Net profit	166.8	41.4	(125.3)	(75.2)	%	277
Depreciation, amortization and impairment loss	362.1	480.9	118.8			3,218
Decrease (increase) in trade working capital	(159.0)	(200.7)	(41.7)			(1,343)
Income taxes paid	(115.4)	(129.0)	(13.6)			(864)
Tax refunds and interest on tax refunds received	6.2	10.1	3.9			68
Other	44.6	88.6	44.0			593
Net cash from operating activities (Operating Cash Flow)	305.2	291.3	(13.9)	(4.6)	%	1,949
Adjustment for cash temporarily held by Takeda on behalf of third parties*1	116.8	(30.2)	(147.1)			(202)
Acquisition of PP&E	(71.4)	(83.8)	(12.4)			(561)
Proceeds from sales of PP&E	0.1	8.3	8.2			56
Acquisition of intangible assets	(67.6)	(255.5)	(187.9)			(1,710)
Acquisition of investments	(4.7)	(2.3)	2.4			(15)
Proceeds from sales and redemption of investments	18.4	0.6	(17.8)			4
Proceeds from sales of business, net of cash and cash equivalents divested	—	0.4	0.4			2
Free Cash Flow	296.9	(71.1)	(368.0)	—		(476)
*1 Adjustment refers to changes in cash balance that is temporarily held by Takeda on behalf of third parties related to vaccine operations and the trade receivables sales program.

A-11

FY2023 H1 Net Debt to Adjusted EBITDA
NET DEBT/ADJUSTED EBITDA RATIO	NET INCREASE (DECREASE) IN CASH
(Billion )	(Billion JPY)	FY2022<br>H1	FY2023<br>H1	vs. PY
Cash & cash equivalents and Level 1 debt investments*1	Net cash from operating activities	305.2	291.3	(13.9)	(4.6)	%
Book value debt on consolidated statements of financial position	Acquisition of PP&E	(71.4)	(83.8)
Hybrid bond 50% equity credit	Proceeds from sales of PP&E	0.1	8.3
FX adjustment*2	Acquisition of intangible assets	(67.6)	(255.5)
Gross debt*3	Acquisition of investments	(4.7)	(2.3)
Net cash (debt)	Proceeds from sales and redemption of investments	18.4	0.6
	Proceeds from sales of business, net of cash and cash equivalents divested	—	0.4
Net debt/Adjusted EBITDA ratio	Net increase in short-term loans and commercial papers	—	110.0
	Proceeds from long-term loans	—	100.0
Adjusted EBITDA	Repayment of long-term loans	(0.1)	(100.2)
	Repayment of bonds	(26.8)	(145.9)
	Proceeds from the settlement of cross currency interest rate swaps related to bonds	—	60.1
	Purchase of treasury shares	(26.9)	(2.3)
	Interest paid	(52.7)	(49.7)
	Dividends paid	(140.0)	(139.8)
	Others	(17.8)	(25.5)
	Net increase (decrease) in cash	(84.3)	(234.2)	(150.0)	(177.9)	%
*1 Represents cash & cash equivalents, excluding cash temporarily held by Takeda on behalf of third parties related to vaccine operations and to the trade receivables sales program, and debt investments classified as Level 1 in the fair value hierarchy being recorded as Other Financial Assets.For the calculation of net debt, starting from the quarter ended June 30, 2023, debt investments classified as Level 1 in the fair value hierarchy being recorded as Other Financial Assets are included in the items deducted from gross debt. Had the same methodology been used for the calculation of net debt as of March 31, 2023 and prior periods, net debt would have remained unchanged.
*2 FX adjustment refers to change from month-end rate to average rate used for non- debt calculation outstanding at the beginning of the period to match with adjusted EBITDA (which is calculated based on average rates). New non- debt incurred and existing non- debt redeemed during the reporting period are translated to at relevant spot rates as of the relevant date.
*3 Bonds and loans of current and non-current liabilities. 250.0 billion reduction in debt due to 500.0 billion hybrid bond issuance in June 2019, given that the hybrid bond qualifies for 50% equity credit for leverage purposes. Includes non-cash adjustments related to debt amortization and FX impact.

All values are in Japanese Yen.

A-12

FY2022 Net Debt to Adjusted EBITDA
NET DEBT/ADJUSTED EBITDA RATIO				NET INCREASE (DECREASE) IN CASH
(Billion )				(Billion )	FY2021	FY2022	vs. PY
Cash and cash equivalents*1				Net cash from operating activities	1,123.1	977.2	(145.9)	(13.0)	%
Book value debt on consolidated statements of financial position				Acquisition of PP&E	(123.3)	(140.7)
Hybrid bond 50% equity credit				Proceeds from sales of PP&E	1.8	1.0
FX adjustment*2				Acquisition of intangible assets	(62.8)	(493.0)
Gross debt*3				Acquisition of investments	(8.3)	(10.2)
Net cash (debt)				Proceeds from sales and redemption of investments	16.9	22.3
				Acquisition of business, net of cash and cash equivalents acquired	(49.7)	—
Upfront payment related to the acquisition of TAK-279*4				Proceeds from sales of business, net of cash and cash equivalents divested	28.2	8.0
Net cash (debt) excluding upfront payment related to the acquisition of TAK-279				Net decrease in short-term loans and commercial papers	(0.0)	40.0
	Proceeds from long-term loans		—
				Repayment of long-term loans	(414.1)	(75.2)
Net debt/Adjusted EBITDA ratio	x			Proceeds from issuance of bonds	249.3	—
Net debt/Adjusted EBITDA ratio excluding upfront payment related to the acquisition of TAK-279	x			Repayment of bonds	(396.0)	(281.5)
		Purchase of treasury shares		(77.5)	(26.9)
				Interest paid	(108.2)	(108.6)
Adjusted EBITDA				Dividends paid	(283.7)	(279.4)
				Others	(41.1)	(47.0)
				Net increase (decrease) in cash	(145.3)	(339.1)	(193.8)	(133.4)	%
*1 Includes short-term investments which mature or become due within one year from the reporting date and excludes cash temporarily held by Takeda on behalf of third parties related to vaccine operations and the trade receivables sales program.
*2 FX adjustment refers to change from month-end rate to average rate used for non- debt calculation outstanding at the beginning of the period to match with adjusted EBITDA (which is calculated based on average rates). New non- debt incurred and existing non- debt redeemed during the reporting period are translated to at relevant spot rates as of the relevant date.
*3 Bonds and loans of current and non-current liabilities. 250.0 billion reduction in debt due to 500.0 billion hybrid bond issuance in June 2019, given that the hybrid bond qualifies for 50% equity credit for leverage purposes. Includes non-cash adjustments related to debt amortization and FX impact.
*4 This represents the portion of the 4.0 billion upfront payment related to the acquisition of TAK-279 paid in February 2023 (such portion totaling 3.0 billion), converted to using the Japanese yen – U.S. dollar exchange rate of 133.48, which is applicable to translation of foreign currency denominated cash as of March 31, 2023.

All values are in Japanese Yen.

A-13

FY2023 H1 Net Profit to Adjusted EBITDA Bridge
(Billion JPY)	FY2022<br>H1	FY2023<br>H1	vs. PY
Net profit	166.8	41.4	(125.3)	(75.2)	%
Income tax expenses	53.3	(2.4)
Depreciation and amortization	326.1	354.2
Interest expense, net	57.5	54.0
EBITDA	603.7	447.2	(156.5)	(25.9)	%
Impairment losses	36.0	126.7
Other operating expense (income), net, excluding depreciation and amortization and other miscellaneous expenses (non-cash item)	65.4	89.6
Finance expense (income), net, excluding interest income and expense, net	(24.0)	27.8
Share of loss on investments accounted for under the equity method	1.4	(1.6)
Other adjustments:	55.5	32.5
Non-core expense related to COVID-19	5.6	—
Impact on profit related to fair value step up of inventory in Shire acquisition	21.9	—
Other costs*1	28.0	32.5
Adjusted EBITDA	737.9	722.2	(15.6)	(2.1)	%
*1 Includes adjustments for non-cash equity-based compensation expense and other one time non-cash expense.

A-14

FY2023 H1 Net Profit to Adjusted EBITDA LTM Bridge
(Billion JPY)	FY2022<br>Full Year<br>(Apr - Mar)	FY2022<br>H1<br>(Apr - Sep)	FY2023<br>H1<br>(Apr - Sep)	FY2023<br><br>H1 LTM*1<br><br>(Oct - Sep)
Net profit	317.0	166.8	41.4	191.7
Income tax expenses	58.1	53.3	(2.4)	2.4
Depreciation and amortization	664.4	326.1	354.2	692.5
Interest expense, net	111.5	57.5	54.0	107.9
EBITDA	1,151.0	603.7	447.2	994.5
Impairment losses	64.4	36.0	126.7	155.1
Other operating expense (income), net, excluding depreciation and amortization and other miscellaneous expenses (non-cash item)	109.0	65.4	89.6	133.3
Finance expense (income), net, excluding interest income and expense, net	(4.7)	(24.0)	27.8	47.1
Share of loss on investments accounted for under the equity method	8.6	1.4	(1.6)	5.7
Other adjustments:	93.5	55.5	32.5	70.5
Non-core expense related to COVID-19	9.9	5.6	—	4.3
Impact on profit related to fair value step up of inventory in Shire acquisition	24.9	21.9	—	3.0
Other costs*2	58.7	28.0	32.5	63.1
Adjusted EBITDA	1,421.8	737.9	722.2	1,406.2
*1 LTM represents Last Twelve Months (October 2022 - September 2023). Calculated by subtracting FY2022 H1 from FY2022 Full Year and adding FY2023 H1.
*2 Includes adjustments for non-cash equity-based compensation expense and other one time non-cash expense.

A-15

FY2023 H1 CAPEX, Depreciation and Amortization and Impairment Losses
(Billion )	FY2023<br><br>H1	vs. PY		FY2023 Revised Forecast<br><br>(October 26, 2023)
---	---	---	---	---
Capital expenditures*1	339.3	200.3	144.1%	480.0 - 530.0*3
Tangible assets	83.8	12.4	17.3%
Intangible assets	255.5	187.9	278.1%
Depreciation and amortization	354.2	28.1	8.6%	680.0
Depreciation of tangible assets*2 (A)	84.8	11.4	15.5%
Amortization of intangible assets (B)	269.4	16.7	6.6%
Of which Amortization associated with products (C)	253.9	13.1	5.4%	500.0
Of which Amortization excluding intangible assets     associated with products (D)	15.5	3.6	30.2%
Depreciation and amortization (excluding intangible assets associated with products) (A)+(D)	100.3	15.0	17.6%	180.0
Impairment losses	126.7	90.8	252.4%
Impairment losses associated with products	115.8	82.9	252.5%	120.0
Amortization and impairment losses on intangible assets associated with products	369.7	96.0	35.1%	620.0
*1 Cash flow base
*2 Including depreciation of investment properties
*3 FY2023 Revised Forecast reflects expenditures related to the acquisition of TAK-279 from Nimbus ( 134.1 billion) and in-licensing of fruquintinib from HUTCHMED ( 55.1 billion).

All values are in Japanese Yen.

A-16

FY2023 Full Year Detailed Forecast
(BN )	FY2023<br>Original Forecast<br>(May 11, 2023)		FY2023<br>Revised Forecast<br>(October 26, 2023)		vs. Original Forecast
---	---	---	---	---	---	---	---	---	---
REPORTED	3,840.0		3,980.0		140.0		3.6	%
		(680.0)		(37.0)		(5.8)	%		Updated for FX
		(500.0)		(20.0)		(4.2)	%		Updated for FX
		(120.0)		(70.0)		(140.0)	%		Revised to reflect impairment losses already booked in H1 (e.g. ALOFISEL, EXKIVITY)
		14.0		—		—	%
		(180.0)		(30.0)		(20.0)	%		Revised to include provisions booked in H1 that were not in the original forecast
		225.0		(124.0)		(35.5)	%		Predominantly due to impairment and provisions listed above; also updated for FX
		(157.0)		8.0		4.8	%
		70.0		(115.0)		(62.2)	%		Reflects items impacting Reported Operating Profit
		93.0		(49.0)		(34.5)	%		Updated tax rate assumption, reflects 63.5B tax expense reduction booked in H1
		59		(31)		(34.5)	%
	3,840.0		3,980.0		140.0		3.6	%
	1,015.0		1,015.0		—		—	%
	434		447		13		3.1	%
	400.0 to 500.0		400.0 to 500.0
	(480.0) to (530.0)		(480.0) to (530.0)
	(170.0)		(180.0)		(10.0)		(5.9)	%
	Mid-to-high teen %		Mid-to-high teen %
	131		137		6		4.6	%
	141		145		4		2.8	%

All values are in Japanese Yen.

*1 Please refer to A-1 Definition of Core Financial Measures, Constant Exchange Rate Change, Free Cash Flow, and U.S. Dollar Convenience Translations, for the definition and A-18 FY2023 Full Year Reconciliation from Reported Operating Profit to Core Operating Profit Forecast, for reconciliation.

A-17

FY2023 Full Year Reconciliation from Reported Operating Profit to Core Operating Profit Forecast
(Billion )	REPORTED		REPORTED TO CORE ADJUSTMENTS						CORE
---	---	---	---	---	---	---	---	---	---
		Impairment of<br>intangible<br>assets		Other<br>operating<br>income<br>(expenses)		Others
Revenue	3,980.0								3,980.0
Cost of sales
Gross Profit
SG&A and R&D expenses								4.0
Amortization of intangible assetsassociated with products	(500.0)		500.0						—
Impairment losses on intangible assets associated with products	(120.0)				120.0				—
Other operating income	14.0						(14.0)		—
Other operating expenses	(180.0)						180.0		—
Operating profit	225.0		500.0		120.0		166.0	4.0	1,015.0

All values are in Japanese Yen.

A-18

FY2023 Full Year FX Rates Assumptions and Currency Sensitivity
Average Exchange Rates vs.						Impact of depreciation of yen from October 2023 to March 2024 (100 million )
---	---	---	---	---	---	---	---	---	---	---	---	---	---
	FY2022 H1<br>Actual<br>(Apr-Sep)		FY2023 H1<br>Actual<br>(Apr-Sep)	FY2023<br>Assumption<br>(Apr-Mar)			Revenue<br>(IFRS)		Operating<br>Profit<br>(IFRS)		Net Profit<br>(IFRS)		Core<br>Operating<br>Profit<br>(non-IFRS)
	131		140	137		1% depreciation	95.2		3.5		(0.5)		24.8
		69.5			2.6			18.1
	138		153	145		1% depreciation	27.4		(18.8)		(15.3)		(14.3)
		18.9			(12.9)			(9.9)
RUB	2.1		1.6	1.6		1% depreciation	2.1		1.1		0.9		1.3
CNY	19.7		19.8	19.8				5.8		4.4		5.8
BRL	26.3		28.5	28.5				3.3		2.5		3.3

All values are in Japanese Yen.

A-19

Important Notice

For the purposes of this notice, “report” means this document, any oral presentation, any question and answer session and any written or oral material discussed or distributed by Takeda Pharmaceutical Company Limited (“Takeda”) regarding this report. This report (including any oral briefing and any question-and-answer in connection with it) is not intended to, and does not constitute, represent or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction. No shares or other securities are being offered to the public by means of this report. No offering of securities shall be made in the United States except pursuant to registration under the U.S. Securities Act of 1933, as amended, or an exemption therefrom. This report is being given (together with any further information which may be provided to the recipient) on the condition that it is for use by the recipient for information purposes only (and not for the evaluation of any investment, acquisition, disposal or any other transaction). Any failure to comply with these restrictions may constitute a violation of applicable securities laws.

The companies in which Takeda directly and indirectly owns investments are separate entities. In this report, “Takeda” is sometimes used for convenience where references are made to Takeda and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies.

The product names appearing in this document are trademarks or registered trademarks owned by Takeda, or their respective owners.

Forward-Looking Statements

This report and any materials distributed in connection with this report may contain forward-looking statements, beliefs or opinions regarding Takeda’s future business, future position and results of operations, including estimates, forecasts, targets and plans for Takeda. Without limitation, forward-looking statements often include words such as “targets”, “plans”, “believes”, “hopes”, “continues”, “expects”, “aims”, “intends”, “ensures”, “will”, “may”, “should”, “would”, “could”, “anticipates”, “estimates”, “projects” or similar expressions or the negative thereof. These forward-looking statements are based on assumptions about many important factors, including the following, which could cause actual results to differ materially from those expressed or implied by the forward-looking statements: the economic circumstances surrounding Takeda’s global business, including general economic conditions in Japan and the United States; competitive pressures and developments; changes to applicable laws and regulations, including global health care reforms; challenges inherent in new product development, including uncertainty of clinical success and decisions of regulatory authorities and the timing thereof; uncertainty of commercial success for new and existing products; manufacturing difficulties or delays; fluctuations in interest and currency exchange rates; claims or concerns regarding the safety or efficacy of marketed products or product candidates; the impact of health crises, like the novel coronavirus pandemic, on Takeda and its customers and suppliers, including foreign governments in countries in which Takeda operates, or on other facets of its business; the timing and impact of post-merger integration efforts with acquired companies; the ability to divest assets that are not core to Takeda’s operations and the timing of any such divestment(s); the extent to which our internal energy conservation measures and future advancements in renewable energy or low carbon energy technology will enable us to reduce our greenhouse gas emissions; and other factors identified in Takeda’s most recent Annual Report on Form 20-F and Takeda’s other reports filed with the U.S. Securities and Exchange Commission, available on Takeda’s website at: https://www.takeda.com/investors/sec-filings/ or at www.sec.gov. Takeda does not undertake to update any of the forward-looking statements contained in this report or any other forward-looking statements it may make, except as required by law or stock exchange rule. Past performance is not an indicator of future results and the results or statements of Takeda in this report may not be indicative of, and are not an estimate, forecast, guarantee or projection of Takeda’s future results.

A-20

Financial Information and Certain Non-IFRS Financial Measures

Takeda’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).

This report and materials distributed in connection with this report include certain financial measures not presented in accordance with IFRS, such as Core Revenue, Core Operating Profit, Core Net Profit, Core EPS, Constant Exchange Rate (“CER”) change, Net Debt, EBITDA, Adjusted EBITDA and Free Cash Flow. Takeda’s management evaluates results and makes operating and investment decisions using both IFRS and non-IFRS measures included in this presentation. These non-IFRS measures exclude certain income, cost and cash flow items which are included in, or are calculated differently from, the most closely comparable measures presented in accordance with IFRS. By including these non-IFRS measures, management intends to provide investors with additional information to further analyze Takeda’s performance and core results, including when controlling for the effect of fluctuations in exchange rates. Takeda’s non-IFRS measures are not prepared in accordance with IFRS and such non-IFRS measures should be considered a supplement to, and not a substitute for, measures prepared in accordance with IFRS (which we sometimes refer to as “reported” measures). Investors are encouraged to review the definitions and reconciliations of non-IFRS financial measures to their most directly comparable IFRS measures.

Medical information

This report contains information about products that may not be available in all countries, or may be available under different trademarks, for different indications, in different dosages, or in different strengths. Nothing contained herein should be considered a solicitation, promotion or advertisement for any prescription drugs including the ones under development.

A-21